The Dow Jones futures were little changed on Wednesday, along with the S&P 500 and Nasdaq futures. The stock market rebound had a mixed session on Wednesday, with the Dow Jones reaching record highs, while many growing names struggled. Bitcoin’s price has risen to over $ 52,000.
X
Federal Reserve officials did not expect to start reducing their huge asset purchase program for “some time”, the recently released minutes of the Fed meeting in January showed. About that, Tesla (TSLA) has recovered from mainstream support as ARK Funds’ Cathie Wood said she is buying more Tesla shares as “our confidence in Tesla has grown”. But Apple (AAPL) key levels of reduction.
Meanwhile, communications software maker Twilio (TWLO), Canadian cannabis producer Tilray (TLRY), leading network leader Quickly (FSLY), Chinese search giant Baidu (BIDU), manufacturer of genomic tools 10X Genomics (TXG), specialist in fertilizers mosaic (MOS), lithium miner Albemarle (ALB) and chip design software manufacturer Synopsys (SNPS) were the main overnight gains.
The shares of Twilio and Tilray were the big winners overnight, while the shares of Mosaic and Baidu rose modestly. ALB, Fastly and Synopsys shares fell slightly, while TXG shares were not active.
Generally, these actions are not close to buying points, either because they are too extended or well out of maximums. Mosaic stock, which achieved a short consolidation on Tuesday.
Shares of Apple and Tesla are on the IBD Leaderboard.
IBD stock of the day burst amid rising energy prices
Dow Jones Futures Today
Dow Jones futures fell 0.1% against fair value. The S&P 500 and Nasdaq 100 futures remained largely unchanged.
Bitcoin’s price rose to over $ 52,000 on Wednesday, a day after reaching $ 50,000 for the first time. Bitcoin remains above $ 52,000 in late afternoon trading. Cathie Wood, who has been buying Bitcoin-related pieces, said the cryptocurrency could reach $ 200,000 if more companies join Tesla in buying Bitcoin.
Remember that overnight action on Dow futures and elsewhere does not necessarily translate into real trading in the next regular stock market session.
Join IBD experts as they analyze actionable stocks at the stock market’s high on IBD Live.
Coronavirus News
Coronavirus cases worldwide reached 110.36 million. Deaths from Covid-19 reached 2.43 million.
Coronavirus cases in the USA reached 28.43 million, with deaths above 501,000.
Fed Signals No Bond Taper For ‘Some Time’
Strong retail sales and other economic data at the beginning of Wednesday seemed to reduce growth stocks at the opening. A stronger economy is good news, if all things are equal. However, the strong reports ease the pressure to pass on a huge new stimulus, although a big package is still likely. In addition, the 10-year Treasury’s yield has been rising in recent weeks, moving slightly upwards on Wednesday.
However, the Federal Reserve is in no hurry to eliminate the punch. While some Fed officials may be concerned about asset prices, Fed chief Jerome Powell and the central bank are focused on reviving economic growth and employment. The minutes of the Fed meeting released on Wednesday afternoon made it clear that lawmakers will continue to pour cheap money into financial markets and the economy.
Stock market rally Wednesday
The stock market recovery started off badly, at least for growth stocks, worsening as the morning progressed. But ARK Funds CEO Cathie Wood spoke about Tesla’s shares. At 2 pm Eastern Time, the minutes of the Fed meeting were released.
The Dow Jones Industrial Average rose 0.3% in Wednesday’s stock market trading, with industrial, financial and fertilizer manufacturers and other real economy stocks doing well. The S&P 500 index closed just below fair value. The Nasdaq compound fell 0.6%, close to the session highs, after falling 1.7% during the day.
Tesla Stock A Buy?
Tesla’s stock fell to 762.08 during the day, almost reaching its 50-day line and lowering the 10-week average. But the stock rose and closed at 0.2%, to 798.15. Cathie Wood said she is still buying shares in the EV maker. Wood again expressed “confidence” in Tesla’s potential to drive and drive alone. Wood has long been a driving force behind Tesla’s autonomous driving efforts, even as autonomous experts have increased criticism and more rivals are testing real autonomous vehicles.
This is the first 50-day / 10-week test of TSLA’s stock since its launch in November, so it could be a buy signal. However, Tesla’s shares remain below its 21-day exponential moving average, an area of resistance for the past few days.
Apple stock
Apple’s shares did not do so well, falling 1.8% to 130.84, closing below its 50-day and 10-week lines. Shares are falling more and more from a 138.89 cup buying point with handle. The relative force line for Apple’s stock continues to disappear. Apple shares are still not giving a big sell signal – they are just 1.2% below their 10-week line – unless you are 7% -8% below the purchase price.
The growing stocks performed hard, with highly valued software names and speculative stocks under attack, while reducing losses.
Among the best ETFs, Innovator IBD 50 ETF (FFTY) sank 1.7%, while Innovator IBD Breakout Opportunities ETF (BOUT) lost 2%. The iShares Expanded Tech-Software Sector (IGV) ETF fell 1%. VanEck Vectors Semiconductor ETF (SMH) sank 1.9%.
ARK Innovation ETF (ARKK) lost 2.1% and ARK Genomic Revolution (ARKG) 1.8%.
Key earnings
Twilio’s earnings outperformed views, while revenue orientation was strong. Twilio’s shares jumped 10% overnight, signaling a record high. TWLO’s shares plunged 2.3% on Wednesday to 411.65.
Tilray reported a less-than-expected loss, while sales narrowly outperformed. Tilray’s shares jumped 9% in expanded trade. But that is not a big change for this marijuana stock. TLRY’s shares fell 9% to 31.51 on Wednesday, well below the February 10 peak of 67.
Profits quickly outperformed quarterly views, but their orientation ranged from aligned to slightly below consensus. FSLY’s shares fell 3% in early trading. The stock fell rapidly 2.7% to 94.85 on Wednesday, a fifth consecutive fall. The shares are in a broad and loose consolidation that seems more suspicious at the current stage of the stock market recovery.
Baidu’s gains easily exceeded forecasts, but sales lost. Baidu’s shares rose 2% in expanded trade. BIDU’s shares fell 5.4% on Wednesday, taking a string of consecutive victories to a record high.
10X Genomics reported a huge loss, but sales increased 49%, exceeding views. 10X shares were not yet active overnight. TXG’s shares plunged 2.5% on Wednesday, after reversing downward from a record high on Tuesday.
Mosaic’s earnings easily exceed consensus. MOS shares were up 2% in prolonged action. Mosaic’s shares fell 0.7% on Wednesday after closing a small consolidation on Tuesday.
Synopsys’ earnings outperformed the first quarter’s fiscal views. The SNPS stock fell 1% overnight. Synopsys fell 2.4% on Wednesday, after reversing downward from a record high on Tuesday. SNPS inventory is extended from a 246.79 flat-based point of purchase, according to MarketSmith’s analysis.
Albemarle’s profits exceeded forecasts. ALB’s shares fell 2.5% in expanded trade. Albemarle’s shares fell 2.9% on Wednesday, reducing its 50-day line after reversing Tuesday’s low to below its 21-day line. Investors could buy a recovery of ALB’s shares from the 50-day line, but should probably wait for a move above 21 days or even for Tuesday’s intraday high of 171.35.
Why this IBD tool simplifies the search for the best actions
Bullish stock market analysis
Whether you want to call Wednesday’s session a pullback or a spin, the stock market rally saw a move out of the main stocks on Wednesday.
Is it just another 1-day break or the beginning of a week-long setback or something more serious? Nasdaq is now 6.2% above its 50-day moving average. It is out of recent highs, but still a little extended. A retreat to the 21-day exponential moving average or even to the 50-day line can still be seen as a relatively modest retreat, especially if the market has recovered. However, there is always the possibility that this retreat is more profound and lasting.
Nasdaq never reached its 21-day line on Wednesday, but many growing names dropped more than 5% or more, increasing Tuesday’s losses.
No more market play
Powerful stock market rallies are great, but they can lead to bad habits. In the past 10 months, if you leveraged hard, bought the most popular names, added setbacks and didn’t worry about complicated consolidations, then your portfolio has made huge gains.
Investors who bought the Nasdaq or Tesla stock fall were rewarded again on Wednesday, at least for a few hours. Perhaps growth actions will reach record highs again.
But if you trade like it’s a wild and unstoppable high in the stock market in the long run, your portfolio will explode.
It is time to strive and adopt some appropriate sales rules and focus on building first-rate stock bases.
Remember that these main stocks and quality bases may not have traditional growth names. At a minimum, investors should expand their horizons to the cyclical and financial sectors.
Read The Big Picture every day to stay in sync with market direction and leading stocks and sectors.
Follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
YOU MIGHT LIKE:
Do you want to make quick profits and avoid big losses? Try SwingTrader
Best growth stocks to buy and watch
IBD Digital: Unlock premium stock lists, tools and analytics today