Tech futures dived Wednesday, as Magnificent Seven stocks Alphabet (GOOGL), Microsoft (MSFT) and Tesla (TSLA) sold off in morning trade, along with chip giant Advanced Micro Devices (AMD). But Dow Jones futures were higher as Wall Street braced for the Federal Reserve’s interest rate decision.
X
Before the opening bell, tech-heavy Nasdaq 100 futures tumbled more than 1% in premarket action. Dow Jones futures were up 0.1%, while the S&P 500 fell 0.5%.
Among U.S. exchange traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) was down 1.1%, while the SPDR S&P 500 ETF (SPY) lost 0.5%.
The 10-year Treasury yield dipped to 4.01%. Further, oil prices threatened to give up Tuesday’s gains, as West Texas Intermediate futures fell more than 1%. WTI futures traded just below $77 a barrel.
January’s ADP private payrolls report missed estimates Wednesday morning, falling to 107,000, far below the 145,000 Econoday estimate, vs. 164,000 in December.
Today’s Fed decision looms at 2 p.m. ET. That decision will be followed up by a press conference with Fed Chief Jerome Powell. The CME FedWatch Tool shows a 98% chance of the Fed keeping rates steady at the 5.25%-5.5% level.
Big Earnings Reports
Alphabet reported fourth-quarter earnings and revenue that topped analyst estimates. But shares tumbled 5.4% as the core advertising business slightly missed views.
AMD stock dived more than 4% after the company delivered mixed fourth-quarter results and offered an outlook that was lower than views for the current period.
Microsoft beat Wall Street’s targets for its fiscal second quarter thanks to strong cloud computing business. But shares dropped nearly 1% in premarket trade.
Other key earnings movers Wednesday include Boeing (BA), Mastercard (MA) and Starbucks (SBUX).
Boeing shares rose around 2%, while Mastercard dropped 0.7%. Starbucks stock rallied 4.8% in premarket trading.
Elsewhere, Tesla stock sold off 2.7% after a Delaware judge voided Chief Executive Elon Musk’s $56 billion compensation plan, siding with plaintiffs who argue that Tesla’s board acted improperly in setting the pay deal.
Dow Jones Hits New High
On Tuesday, the Dow Jones Industrial Average moved up 0.35% and the S&P 500 edged 0.1% lower. The tech-heavy Nasdaq composite declined 0.8%.
Tuesday’s Big Picture column commented, “Making money in the stock market is trickier now than it was in early November when the Nasdaq composite and S&P 500 confirmed new uptrends with follow-through days. That’s because there’s no shortage of stocks extended past proper buy points.”
Now is an important time to read IBD’s The Big Picture column amid the continuing stock market rally. Be sure to read how to adjust to changing market conditions, with IBD’s new exposure levels.
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Best Stocks To Buy And Watch
DraftKings (DKNG), KKR (KKR), Novo Nordisk (NVO) and Snowflake (SNOW) — plus Dow Jones components Amgen (AMGN), Merck (MRK) and Walmart (WMT) — are among the best stocks to buy and watch in the current market rally.
KKR and Walmart were featured in this Stocks Near A Buy Zone column. DraftKings is an IBD Leaderboard Watchlist stock, while KKR is on IBD SwingTrader.
Get Real-time Buy And Sell Alerts On Stock Market Leaders With IBD Leaderboard
Dow Jones: Walmart Breaks Out
Biotech leader Amgen rose 0.4% Tuesday, further out of the 5% buy range past a 288.46 official buy point in a flat base. The 5% buy area went up to 302.88. Amgen shares added 0.3% Wednesday.
Drugmaker Merck is breaking out past a cup base’s 119.65 buy point, according to IBD MarketSmith pattern recognition. Shares finished further above their entry amid a 0.3% climb Tuesday. Merck stock rose 0.7% Wednesday.
Discount retail giant Walmart is in buy range past a 163.57 entry in a cup with handle, amid a four-day win streak. The stock was up 1% early Wednesday after the company declared a 3-for-1 stock split, its first since 1999.
4 Top Growth Stocks To Watch In The Stock Market Rally
DraftKings Breaks Out
IBD Leaderboard Watchlist stock DraftKings rallied nearly 1% Tuesday, further past a double-bottom base’s official buy point at 38.97. DraftKings stock dropped 0.7% Wednesday morning.
IBD SwingTrader stock KKR broke out last week, moving above an 85.66 flat-base entry. Shares climbed 1.7% Wednesday morning.
Novo Nordisk, the maker of weight-loss drugs, ended Tuesday unchanged, squarely above its 105.69 flat-base buy point. Novo shares rose 1.1% early Wednesday.
Software leader Snowflake remains above a 202.83 buy point in a flat base despite a 1.65% drop Tuesday, according to IBD MarketSmith. Snowflake shares fell 2.1% Wednesday.
Best Bets In Today’s Action
These are four best stocks to watch in today’s stock market, including a Dow Jones leader.
| Company Name | Symbol | Correct Buy Point | Type Of Buy Point |
|---|---|---|---|
| Novo Nordisk | (NVO) | 105.69 | Flat base |
| Merck | (MRK) | 119.65 | Cup base |
| DraftKings | (DKNG) | 39.35 | Cup base |
| Spotify | (SPOT) | 202.88 | Flat base |
Source: IBD Data As Of Jan. 30, 2024
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Magnificent Seven Stocks: Nvidia
Magnificent Seven stock Nvidia (NVDA) lost 2% in premarket action Wednesday.
Nvidia rallied 0.5% Tuesday, more than 20% past a a 505.48 buy point in a flat base after a Jan. 8 breakout move. Shares set more record highs.
Dow Jones Leaders: Apple
Among Dow Jones stocks in the Magnificent Seven, Apple (AAPL) traded marginally lower ahead of Wednesday’s stock market open.
Apple stock fell 1.9% Tuesday, extending a losing streak to five sessions and closing below its 50-day line, a key support level. Shares are now about 6% away from their flat base’s 199.62 buy point. Shares dropped 0.2% early Wednesday.
Be sure to follow Scott Lehtonen on X, formerly known as Twitter, at @IBD_SLehtonen for more on growth stocks and the Dow Jones Industrial Average.
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