Dow Jones Futures Fall, Nvidia Dips; U.S. Markets Shut After

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Dow Jones NewsJan 9, 2:32 PM UTC
DJ Dow Jones Futures Fall, Nvidia Dips; U.S. Markets Shut After IonQ, Rigetti, SoundHound Dive -- IBD

By Ed Carson

 

Dow Jones futures fell modestly early Thursday, along with S&P 500 futures and Nasdaq futures. The U.S. stock market will be closed in honor of former President Jimmy Carter.

 

Taiwan Semiconductor, Delta Air Lines and the December jobs report are on tap Friday morning.

 

The stock market rally closed narrowly mixed Wednesday after Tuesday's sell-off. The Nasdaq held critical support.

 

Nvidia just held key levels after tumbling Tuesday. Tesla edged higher, continuing to consolidate.

 

Nvidia stock fell slightly Wednesday night as the Biden administration plans to step up chip export curbs again.

 

Dockworkers and employers announced a tentative deal at East Coast and Gulf ports to avoid a crippling shutdown.

 

Quantum computing stocks IonQ, Rigetti Computing, D-Wave Quantum and Quantum Computing dived Wednesday. SoundHound AI and highly speculative nuclear plays such as Oklo also tumbled.

 

Meanwhile, Palantir Technologies, AppLovin and Astera Labs, three "heat" stocks with strong fundamentals, retreated Wednesday, but came off lows.

 

Nvidia is on IBD Leaderboard, with Tesla stock on the Leaderboard watchlist. Taiwan Semiconductor stock and Nvidia are on the IBD 50. AppLovin and Palantir stock are on the IBD Big Cap 20.

 

DOW JONES FUTURES TODAY

 

Dow Jones futures sank 0.2% vs. fair value. S&P 500 futures fell 0.3%. Nasdaq 100 futures declined 0.3%.

 

The 10-year Treasury yield retreated to 4.65%.

 

Bitcoin fell to above $92,000, testing some short-term lows.

 

U.S. stock and bond markets will be closed Thursday as a day of mourning for former President Jimmy Carter. Other markets around the world are open.

 

Dow futures are now closed, They will reopen at 6 p.m. ET.

 

Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.

 

JOBS REPORT

 

The Labor Department will release the December jobs report at 8:30 a.m. ET Friday. Economists expect nonfarm payrolls to rise by 157,000 after November's gain of 227,000. The jobless rate should hold at 4.2% with average hourly earnings steady at a 4% annual gain.

 

Other labor data has been mixed, with higher job openings and lower jobless claims signaling strength and the ADP Employment Report weaker than expected.

 

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STOCK MARKET RALLY

 

The stock market rally wavered on Wednesday, with the major indexes peeking above and below breakeven throughout the session.

 

The Dow Jones Industrial Average rose 0.25% in Wednesday's stock market trading. The S&P 500 index climbed 0.2%. The Nasdaq composite fell less than 0.1% after testing the 50-day and 10-week lines. The small-cap Russell 2000 gave up 0.5%.

 

Market breadth was weak.

 

A number of quality stocks were holding up, including Tradeweb Markets, Netflix, Sea, American Express, Energy Transfer, Vistra, Entergy, Baker Hughes, Howmet Aerospace, DT Midstream, Embraer, Spotify and United Airlines.

 

U.S. crude oil prices fell 1.25% to $73.32 a barrel.

 

The 10-year Treasury yield rose a fraction to 4.69% after hitting 4.72% intraday. That's just below the 52-week high of 4.74% set last April.

 

ETFS

 

Among growth ETFs, the Innovator IBD 50 ETF was just above break-even. The iShares Expanded Tech-Software Sector ETF also edged higher with Palantir and AppLovin stock both in the ETF. The VanEck Vectors Semiconductor ETF fell 0.7%. Nvidia and Taiwan Semi stock are huge SMH holdings.

 

ARK Innovation ETF rose 0.1% and ARK Genomics ETF fell 0.1%. Tesla stock is still a major holding across Ark Invest's ETFs. Cathie Wood's Ark also owns a lot of Nvidia.

 

SPDR S&P Metals & Mining ETF retreated 0.55%. U.S. Global Jets ETF was flat, with Delta stock a key holding. SPDR S&P Homebuilders ETF climbed 1.1%. The Energy Select SPDR ETF inched up 0.1% and the Health Care Select Sector SPDR Fund advanced 0.5%.

 

The Industrial Select Sector SPDR Fund added 0.4%. The Financial Select SPDR ETF rose 0.3%.

 

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QUANTUM COMPUTING, OTHER HEAT STOCKS

 

IonQ stock dived 39% Wednesday, closing below the 50-day line for the first time since Sept. 12. Rigetti stock crashed 45% and Quantum Computing plunged 36%. D-Wave Quantum stock lost 43%. Nvidia CEO Jensen Huang said Tuesday night that the technology won't be "very useful" for 15-to-30 years.

 

SoundHound AI stock sold off 16% to 15.02, testing its 10-week line. SOUN stock, an AI play, is off 27% so far this week.

 

Oklo stock dived 11.5% to 26.12 after reversing from a record high Tuesday. Shares tested a 24.99 handle buy point intraday.

 

Among less-speculative heat plays, Palantir stock slumped 2.5%, bringing its weekly loss to almost 15%. PLTR nearly tested its 50-day line, but it's already notably below its 10-week. AppLovin stock edged down 0.2% after Tuesday's 7% tumble. APP is some distance above its 50-day but clearly below its 10-week. Astera Labs stock sank 2.1%, but closed above its 21-day line. ALAB stock, a 2024 AI chip IPO, is still well above its 50-day and 10-week lines.

 

NVIDIA STOCK

 

Nvidia stock lost 2 cents to 140.11 Wednesday, just holding the 50-day/10-week lines.

 

On Tuesday, shares dived 6.2% after briefly hitting a record 153.13 after the open, falling back below a shallow double-bottom base buy point of 146.54.

 

NVDA stock fell slightly Wednesday night. The Biden administration will impose new curbs on AI and other advanced chips to Southeast Asia and Persian Gulf states, with global restrictions expanding to all but a handful of close allies, Bloomberg reported. The aim is to close off close off roundabout access to China and Russia.

 

Nvidia CEO Huang on Monday night talked up huge opportunities and new partnerships for the AI chip leader. Analyst reviews were positive, but the market reaction was not.

 

Taiwan Semiconductor stock fell 2% to 207.12, adding to Tuesday's 3.9% slide, but still above a 205.63 cup-with-handle buy point.

 

Taiwan Semiconductor will report December sales on Friday, with fourth-quarter earnings due Jan. 16. Both will be important for the broader AI and chip spaces.

 

TESLA STOCK

 

Tesla stock edged up 0.15% to 394.94, still below the 21-day line after slumping 4.1% on Tuesday. Shares have been consolidating since hitting a record 488.54 on Dec. 18. Ideally, the EV giant would find support around its 10-week and 50-day moving averages or even forge a new base. The 10-week line is close to catching up.

 

WHAT TO DO NOW

 

The stock market is choppy, with intraday, daily and weekly swings, with a slightly downward trend.

 

The trading environment is extremely dangerous. Investors will get bullish signals in a sideways market that lures them in. But most of those names will fade within a couple days, sometimes within minutes.

 

Investors can still have significant exposure, but probably raising cash in recent days is a good idea, if only by selling specific holdings.

 

Keep working on watchlists. A number of stocks noted above are holding up reasonably so far. If the market improves ---- it's always possible that the next bounce will be the one that has legs ---- many of these names and others could do well. But it wouldn't take much for these stocks to break down either.

 

Don't get excited from a strong open or even a positive rebound. You can always test the waters, but it's not a time to be taking the plunge.

 

Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.

 

Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.

 

View this article at Investors.com

 

https://www.investors.com/market-trend/stock-market-today/dow-jones-futures-nasdaq-nvidia-hold-support-ionq-rigetti-soundhound-dive/

 

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January 09, 2025 09:32 ET (14:32 GMT)

 
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