Dow Jones futures were little changed after hours, along with S&P 500 futures and Nasdaq futures. The central bank will end its two-day meeting on Wednesday afternoon, with the Fed’s outlook for interest rate cuts in focus.
X
The stock market, especially the Nasdaq, recovered from its initial decline and posted modest gains on Tuesday.
Nvidia (NVDA) initially retreated after the big AI event, but then reversed slightly and rose. Many other artificial intelligence stocks have similarly pared losses or turned positive. but, Advanced Micro Devices (AMD) While firmly retreating, super microcomputer (SMCI) Plans for an initial public offering fell through.
early Wednesday morning, broadcom (AVGO) will host an AI Investor Meeting as the Nvidia GTC conference continues. micron technology (Mu) is scheduled to announce its second-quarter financial results, including the impact on AI, on Wednesday night. on thursday, microsoft (MSFT) will host its own AI event.
woodward (WWD), cyberark software (cyber-), crowdstrike holdings (CRWD), Arista Networks (ANET), ares management (Ares), cadence design system (C.D.N.S.), synopsis (SNPS), jayfrog (frog), transdigm (TDG), draft kings (DKNG), neurosecretory biological science (NBIX), arch lock (Alok), dexcom (DXCM), royal caribbean (R.C.L.) and Microsoft stock are both worth watching.
Investors should remain cautious until after the Fed meeting and Fed Chairman Powell’s press conference.
Nvidia and ARM stock prices are on the rise IBD Leaderboard, Dexcom is on your leaderboard watchlist. DraftKings stock is listed on SwingTrader. Stocks of Microsoft, Cadence Design, and Synopsys are among his IBD long-term leaders. Nvidia stock, Arm Holdings, CrowdStrike, DraftKings, Arista Networks, Ares, JFrog, Royal Caribbean, and Microsoft are on the list. IBD50. Nvidia, CrowdStrike, Arista Networks, and Super Micro stocks. IBD big cap 20. Mr. Woodward was IBD’s “Stock of the Day” on Tuesday.
The video embedded in the article reviewed Woodward stocks, Synopsys, and Arista Networks.
Fed meeting
The Fed will release an updated “dot plot” of policymakers’ interest rate forecasts at 2 p.m. ET. In late 2023, the dot plot suggested the Fed would cut rates three times in 2024. There is speculation that policymakers could reduce this to two rate cuts.
Fed Chairman Jerome Powell will hold a press conference at 2:30 pm ET.
The market is slightly leaning toward the Fed’s June rate cut, but the deal is far from done.
Dow Jones futures today
Dow Jones futures fell slightly relative to fair value. S&P 500 futures and Nasdaq 100 futures are almost unchanged.
Please note that overnight trades such as Dow futures do not necessarily translate into actual trades in the next regular stock market.
IBD experts analyze leading stocks and markets on IBD Live.
stock market rise
Tuesday’s stock market rally showed resilience, with the Nasdaq slightly reversing higher.
The Dow Jones Industrial Average rose 0.8% in stock market trading on Tuesday. The S&P 500 index rose 0.6%. The Nasdaq Composite rose 0.4%. The 21-day moving averages of the Dow Jones and Nasdaq maintained support, with the latter also holding the 16,000 level.
The market breadth was strong.
The small-cap Russell 2000 rose 0.5% but remains below its 21-day line. Supermicro and several other high-flying stocks with relatively large weights may have weighed on the index on Tuesday.
The stock market’s rally has largely stalled in March, with the Nasdaq and Russell 2000 showing a more long-term pattern. This will form several bases. Even better, the 50-day moving average has closed the gap to the Nasdaq, giving the market a little more room to move if there is further upside.
It was positive to see Nvidia and Microsoft, the two big leaders in AI, showing resilience. Many major tech stocks are at important levels and could be significantly stronger or weaker in just a few days. Meanwhile, several other areas of the market are showing strength, particularly commodities and energy.
The outlook for Fed rate hikes and Chairman Powell’s comments are sure to move stock prices and bond yields Wednesday afternoon. This is essentially an earnings report for the entire market. The S&P 500 could quickly rise or fall by 1% or 2% after the Fed moves, perhaps in a big whip-like move. Don’t be surprised if the Fed’s reaction on Day 2 is reversed.
The 10-year Treasury yield fell 4 basis points to 4.3%, ending the winning streak at six, but still near its 2024 high.
U.S. crude oil prices rose 0.9% to $83.47 per barrel, the highest closing price since late October.
ETF
Among growth ETFs, iShares Expanded Technology Software Sector ETF (IGV) rose 0.7%. Microsoft owns a huge stake, and CrowdStrike is also included in the ETF. VanEck Vectors Semiconductor ETF (SMH) fell 0.2%, with Nvidia stock being a major component, but AMD also being a major member. Shares in Synopsys and Cadence Design are in both his IGV and SMH.
ARK Innovation ETF (Arkku) fell 0.6%, ARK Genomics ETF (arcg) rose 0.4%.
SPDR S&P Metals & Mining ETF (XME) rose 0.4%. SPDR S&P Home Builders ETF (XHB) rebounded by 1.8%. Energy Select SPDR ETF (XLE) rose 1.1%, while the Healthcare Select Sector SPDR Fund (XLV) rose 0.7%.
Industrial Select Sector SPDR Fund (XLI) rose 0.9%. Financial Select SPDR ETF (XLF) rose 0.5%.
Timing the Market with IBD’s ETF Market Strategy
nvidia stock
Nvidia fell as low as 850.10 on Tuesday morning, but closed 1.1% higher at 893.98. Since reaching historic levels earlier this month, Nvidia has continued to move sideways. Since the earnings announcement on February 21st, the 21-day line has not yet been touched, and it is still extended from the 50-day line. However, NVDA stock may be stuck in a tight three-week pattern.
Late Monday, Nvidia unveiled a new, faster AI chip and made a number of announcements at its GTC conference, which runs through Thursday. The AI chip was expected, but I was still impressed.
AMD stock fell 4.8% to 181.42, completely reversing its recent rally. The company has rebounded slightly from its 50-day line. AMD stock is down more than 5% so far this week after falling 7.9% last week. AMD has been catching up with Nvidia’s AI chips, but will now be behind Blackwell’s new entrants.
Broadcom stock rose slightly, but ended below its 50-day gain line for the first time since early November. Broadcom’s AI news on Wednesday will be important for AVGO stock and many other AI-related businesses, including partner Arista Networks.
super micro stock
Supermicro stock fell nearly 9% to 910.97, closing below its 21-day moving average for the first time in months. The AI server maker announced that it plans to sell 2 million shares of Super Micro stock. However, SMCI stock closed well below its intraday low of 863.
Investors who have held Supermicro since its January breakout may have sold some of their holdings in the wake of Tuesday’s drop. A decisive breakout of the rapidly rising 50-day line could provide a strong sell signal.
Up-and-coming stocks
Cadence Design stock and Synopsys continued to rebound from their 10-week lines, breaking Tuesday’s brief downtrend on strong volume. These two stocks are viable, along with Dexcom stock, which is arguably at a flat-based buy point.
Most others have set up stocks.
According to , Woodward stock is near a flat-based buy point, along with Arista Networks and Neurocrine Biosciences. Market surge analysis. Royal Caribbean stock is working on a short cup-based handle.
ArchRock stock is nearing a rising key buy point.
CyberArk, CrowdStrike, and Ares stocks are finding support near their 10-week lines. TransDigm stock and JFrog are paused in a bullish position at the 21-day line.
DraftKings stock has rebounded from its 21-day and 10-week levels and is nearing a new foundation.
Microsoft stock is just around the buy point from short-term consolidation heading into Thursday’s “Future of Work” event.
what to do now
This is a time when it is important to monitor rather than take too many actions. The market’s upward trend appears to be tired and is coming to a halt. Perhaps the major indexes and stocks are poised for another rally soon, or perhaps they are about to undergo a more significant decline.
The Fed meeting will be the next big test. Thursday’s Microsoft AI event may not be as important as the Nvidia GTC conference or his FRB meeting, but it will also be important, especially for the AI software industry and major suppliers.
Investors need to be prepared as the market and many major stocks are nearing a tipping point. Keep your watchlist up to date and prepare your exit plan. Be proactive and stay flexible.
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