[ad_1]
Dow Jones futures will open Sunday night, along with S&P 500 futures and Nasdaq futures, after the major indexes posted strong weekly gains, hitting all-time highs.
x
Sometimes the stock market is quite simple. Two broad factors have fueled the market rally since late October: expectations of Fed rate cuts and the ongoing rise of artificial intelligence.
Last week, the Federal Reserve reaffirmed its projections to cut rates three times in 2024. Meanwhile, NVIDIA (NVDA), Broadcom (AVGO) and microsoft (MSFT) had optimistic AI events, while Micron technology (MU) reported surprising earnings and strong guidance thanks to AI tailwinds.
Nvidia, Broadcom and Micron stocks had big weekly gains, along with a host of other AI plays. Microsoft stock made a modest gain to new highs, but is still actionable.
But there was broad-based strength, with many sectors enjoying big gains as a diverse group of stocks flashed buy signals, including financials.
Uber Technologies (UBER), Eli Lilly (LYLY), CrowdStrike Holdings (CRWD) are leading actions that are based on disorderly consolidations.
Investors can still take advantage of some actionable names through incremental purchases, perhaps looking beyond widespread AI leaders like Nvidia stock.
Nvidia and Uber shares are on the rise Classification of IBD. Microsoft stock is in IBD Long-Term Leaders. Nvidia and CrowdStrike shares are on the market. IBD 50. Broadcom, CrowdStrike and Nvidia shares are on the market. IBD 20 Large Cap list. Uber was Friday’s IBD Stock of the Day.
Dow Jones Futures Today
Dow Jones futures open at 6 pm ET on Sunday, along with S&P 500 futures and Nasdaq 100 futures.
Remember that overnight action in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
Join IBD experts as they analyze leading stocks and the market on IBD Live
Stock market rally
The stock market rally had a strong week thanks to a dovish Fed and bullish AI outlook. Major indices rose strongly and all hit all-time highs, although they pulled back from Thursday’s intraday highs.
The Dow Jones Industrial Average gained 2% in stock trading last week. The S&P 500 index rose 2.3%. The Nasdaq Composite rose 2.85%.
The small-cap Russell 2000 rose 1.6%, hitting a 23-month closing high on Thursday before retreating on Friday.
The Nasdaq decisively cleared trading dating back to early February, while the Russell 2000 is back above a range from late December to late February. That meant several leading stocks broke out or showed other buying signals.
Meanwhile, the S&P 500 and Nasdaq have not extended from the 50-day line, although it wouldn’t take much for that to happen.
Nvidia and other big AI stocks like Micron, Broadcom and Microsoft boosted the major indexes a bit.
The 10-year Treasury yield fell 9 basis points to 4.22%, retreating after nearly hitting 2024 highs on Monday.
U.S. crude oil futures rose 5 cents to $80.63 a barrel last week, moving away from 2024 highs.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF (VAT) rebounded 2.9%, with Microsoft stock a big holding and CrowdStrike also on IGV. The VanEck Vectors Semiconductor ETF (SMH) rose 4.5%. Nvidia is SMH’s dominant holding company, with Broadcom and Micron shares also key members.
SPDR S&P Metals & Mining ETF (XME) rose 2.5% last week. The Global X US Infrastructure Development ETF (TO PAVE) rose 3.2%. US Global Jets ETF (JETS) rose 3.4%. SPDR S&P Homebuilders ETF (XHB) jumped 4.8%. The Energy Select SPDR ETF (XLE) gained 0.9%, approaching a 52-week high. The Health Care Select Sector SPDR Fund (XLV) rose slightly. The SPDR Select Industrial Sector Fund (XLII) advanced 2.6%.
The Financial Select SPDR ETF (XLF) rose 1.5% and the SPDR S&P Regional Banking ETF (KRE) rose 1.3%
Reflecting stocks with more speculative histories, ARK Innovation ETF (ARKK) rose 1.5% last week and the ARK Genomics ETF (ARKG) fell just over 1%.
Time the Market with IBD’s ETF Market Strategy
Stocks Near Buy Points
Uber stock has been consolidating for several weeks, which investors can treat as a de facto flat base with a buy point of 82.14. Shares rose 5.5% to 80.23 this week, rebounding from the 10-week line. Investors could use Thursday’s high of 81.23 as a slightly early entry.
Eli Lilly stock also has a false flat base, with a buy point of 800.78. LLY stock has recently found support at the 21-day moving average. Shares rose 2.1% to 770.30
CrowdStrike shares gained 3.8% to 327.58 last week, bouncing off the 10-week line. Cybersecurity stocks have been trading closely around the 21-day line, but with a couple of big exceptions. Stocks fell on February 21 in reaction to the big Palo Alto Networks (PANW) liquidation, but recovered quickly. The stock retested the 50-day line on March 5, just before the earnings. Shares soared on March 6 following the results, but pared gains. A move above the February 15 high of 338.45 could serve as an entry.
The buzzword for cybersecurity stocks is no longer AI
AI Stocks
Nvidia shares rose 7.34% to 942.89, their 11th consecutive weekly gain, hitting a record close on Friday. On Monday night, the leader in AI chips unveiled its latest AI processor. The Blackwell chip has much faster speeds but will be aggressively priced. Several other analysts raised their price targets on NVDA stock to 1,000 or higher.
Broadcom shares rose 9.55% to 1,353.47, roaring off their 50-day and 10-week lines. There may have been a brief opportunity to buy AVGO, but it has now expanded. Broadcom bounced back at its own AI event on Wednesday.
Micron shares soared 18.2% to 110.21, hitting an all-time high. The memory chip giant reported a surprise profit and steered higher, citing AI-related growth.
Microsoft shares rose 3% to 428.74, hitting an all-time high. Tech giant Dow unveiled Surface AI PCs and showed off Copilot functionality at its “New Era of Work” event on Thursday. MSFT stock is still within range of a 420.83 buy point from a not-quite-flat base. It is also within the scope of the 10-week line.
What to do now
The market rally had a strong week with big positive news, with several stocks from a variety of sectors showing buy signs.
Investors could have taken advantage of those opportunities, especially if they had recently reduced their exposure. But now is not the time to aggressively increase exposure. Make new purchases incrementally, looking beyond a handful of AI names.
Don’t buy extended stocks, even the hottest AI plays.
Definitely work on those watchlists for actionable actions and setups. You want to find the best possible names ahead of time and be ready to pounce when they activate their entries.
Read the big picture every day to stay in sync with the market direction and leading stocks and sectors.
Follow Ed Carson on Threads at @edcarson1971 and X/Twitter in @IBD_ECarson.
YOU MIGHT ALSO LIKE:
Why this IBD tool simplifies your search for the best stocks
Get the next big winning stock with MarketSurge
Do you want to make quick profits and avoid big losses? Try SwingTrader
Best Growth Stocks to Buy and Watch
IBD Digital: Unlock IBD’s premium stock lists, tools and analysis today