Dow Jones futures trended higher overnight, along with S&P 500 futures and Nasdaq futures. The stock market rally rallied on Wednesday, but with less volume than the previous session. Major indices are down for the week, slipping significantly in April.
X
FTNT stock, Marriott International (TO DAMAGE), Raymond James Financial (RJF), note (MRK) and Ultimate beauty (ULTA) are five non-commodity games to check out. Fortinet (FTNT), Marriott and RJF stocks are working on handles around aggressive entries. Merck stock could form a handle while ULTA stock broke out past a buy point.
Among the megacaps, Apple (AAPL) and Tesla stock are attempting to rise within the handles.
key income
UnitedHealth (UNH) reports on the start before the opening of the health insurance companies. UNH stock is slightly extended from a buy zone along with its rival anthem (ANTM). centene (CNC) and Molina health (MOH) are located in buy zones.
Goldman Sachs (GS), Wells Fargo (WFC) and Citigroup (C) Report early Thursday. All three were little changed on Wednesday after that JPMorgan Chase (JPM) reported mixed Q1 results.
Tesla (TSLA) and ANTM stocks are on the IBD leaderboard. FTNT shares are Long-Term Leaders on IBD. Tesla and Fortinet shares are on the IBD 50. Raymond James Financial was Wednesday’s IBD stock of the day and was added to SwingTrader.
The video embedded in this article discussed and analyzed Wednesday’s market rally Lululemon Athletica (LULU), Raymond James and MAR shares.
Join IBD experts as they analyze actionable stocks in the stock market rally on IBD Live
Dow Jones futures today
Dow Jones futures rose 0.1% from fair value. S&P 500 futures trended higher and Nasdaq 100 futures were up 0.2%.
Keep in mind that overnight action in Dow futures and elsewhere doesn’t necessarily translate to actual trading in the next regular trading session.
stock market rally
The stock market rally started little changed on Wednesday but improved steadily throughout the session.
The Dow Jones Industrial Average rose 1% in trading on Wednesday. The S&P 500 index rose 1.1%. The Nasdaq Composite rose 2%. Small-cap Russell 2000 is up 1.9%.
The producer price index showed wholesale inflation rising 11.2% yoy in March, a new record. This follows Tuesday’s report showing consumer inflation hit a 40-year high of 8.5%.
But the 10-year Treasury yield fell 4 basis points to 2.69% for the second straight day.
US crude prices rose 3.6% to $104.25 a barrel.
ETFs
Among the best ETFs, Innovator IBD 50 ETF (FFTY) is up 2.4%, while Innovator IBD Breakout Opportunities ETF (BOUT) is up 1.4%. The iShares Expanded Tech-Software Sector ETF (IGV) is up 2.2%. The VanEck Vectors Semiconductor ETF (SMH) rallied 2.4%.
The SPDR S&P Metals & Mining ETF (XME) was up 4.5% and the Global X US Infrastructure Development ETF (PAVE) was up 1.8%.
The US Global Jets ETF (JETS) is up 5.3%. Airlines and other travel stocks continued to rally Delta Airlines (DAL) Results and Predictions. DAL stock and American Airlines (AAL) surged back above its 200-day moving average.
The SPDR S&P Homebuilders ETF (XHB) is up 1.7%. The Energy Select SPDR ETF (XLE) was up 1.5% and the Financial Select SPDR ETF (XLF) was flat. The Health Care Select Sector SPDR Fund (XLV) edged up 0.5%. UNH stocks and Merck are important XLV stocks.
Reflecting more speculative story stocks, ARK Innovation ETF (ARKK) was up 3.2% and ARK Genomics ETF (ARKG) was up 2.6%. Tesla stock is Ark Invest’s #1 ETF.
The five best Chinese stocks to watch right now
stocks to look at
FTNT shares rose 3.3% to 340.86, rebounding from a 21-day moving average. The cybersecurity company has a handle buy point of 353.08. On Wednesday, the stock came straight down to a brief downward declining trend line. A move above would provide an early entry. Fortinet stock has had wild moves in its consolidation but has traded tightly for the past few weeks. While growth stocks have struggled, cybersecurity is one area that’s been doing reasonably well. Palo Alto Networks (PANW) and quality (QLYS) break out and private equity continues to buy various players.
MAR shares rose 7.5% to 175.54 on above-average volume, rebounding above its 50-day moving average as travel stocks rallied on delta earnings. Marriott shares and some other hotel stocks made gains in late March but then fell sharply. MAR stock now has a buy point for a mug of 179.40. Shares have already broken the handle’s downtrend and offer an early entry.
RJF stock rose 3.2% to 111.64, bouncing off its 50-day moving average and breaking a downtrend in its grip and offering an early entry. Raymond James has an official buy point for a mug of 114.10, according to MarketSmith analysis.
MRK stock rose 0.6% to 86.13 after two declines. Monday’s reversal to the downside ended a steady move higher in the Dow Jones component from late February. The Merck share has a base price of 91.50 points, but seems to be working on a handle.
ULTA stock rose 2.4% to 415.50 and closed above a 408.83 Cup with Henkel buy point after trying to break out in the previous two sessions. The relative strength line has risen sharply this month, hitting 52-week highs in the past few sessions.
Apple, Tesla stock
Apple shares rose 1.6% to 170.40, recovering from its 50-day moving average and roughly close to its 21-day moving average. The iPhone giant has a buy point of 179.71 handles. AAPL stock is arguably breaking a downtrend in this area, but investors may want to see some more strength.
Tesla shares rose 3.6% to 1,022.37, beating its 21-day moving average. Shares are working at a 1,152.97 cup and handle buy point. At 10.7% above its 50-day moving average, this is not an attractive early entry for TSLA stock. Highly rated growth stocks staged a strong rebound on Wednesday but are still struggling overall. Meanwhile, Tesla Shanghai has been closed since March 28 due to Covid restrictions and could be on hold for a few more weeks.
Tesla vs. BYD: Which Booming EV Giant Is the Better Buy?
Analysis of the market rally
The stock market rally rebounded on Wednesday, trimming weekly losses. The Dow Jones and S&P 500 index reclaimed their 50-day moving averages but are below their 200-day moving averages.
The Nasdaq and Russell 2000 are still below their 50-day moving averages, although the small-cap index is getting closer.
Even with their 2% gains, the Nasdaq and Russell 2000 had ranged on the day from Tuesday. Meanwhile, NYSE and Nasdaq volume fell from Tuesday after two consecutive distribution days.
Growth stocks have had a strong session, but with a few exceptions such as FTNT stocks, Apple and Tesla, they are generally struggling with battered charts.
Even more so than the major indices, growth stocks need sustained gains before investors get excited.
The materials sector remains strong, along with defense stocks and medical stocks like UnitedHealth and MRK stocks. Travel games are attempting to regain momentum, with MAR stocks showing early entry.
Time the market with IBD’s ETF market strategy
What now
When the major indices post solid gains, investors will start speculating about potential gains, even if those moves don’t change the charts noticeably. But a strong day in a bad or choppy market is neither surprising nor particularly encouraging.
The market rally remains under pressure.
Investors should have at most modest overall exposure and be largely or entirely focused on resource, medical and defense stocks. Aside from these strong sectors, there is very little broad-based strength.
If you venture beyond these areas, keep the positions very small and definitely don’t focus too much on these areas.
Read The Big Picture every day to keep up with market direction and leading stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
YOU MAY ALSO LIKE:
The best growth stocks to buy and watch
IBD Digital: Unlock IBD’s premium stock lists, tools and analysis today
3 Top S&P 500 Gainers: American Air Leads Travel Revival