Dow Jones futures fell Thursday morning, along with S&P 500 futures and Nasdaq futures, after markets were closed for the Christmas holiday.
The stock market rally had a solid advance in the half-day Christmas Eve session. The Nasdaq led, moving back toward record highs, while the S&P 500 moved back above 6,000. Despite Tuesday’s broad gains, much of the market is lagging.
↑
X
Nasdaq Leads Market Into Holiday; Nvidia, Atour Lifestyle, Fiserv In Focus
Nvidia (NVDA) flashed a buy signal Tuesday as it cleared key levels, but came off intraday highs. Fellow AI chip stocks Broadcom (AVGO) and Astera Labs (ALAB) continued to soar.
Tesla (TSLA) rose strongly Tuesday, extending Monday’s bounce after a modest pullback.
China hotel operator Atour Lifestyle Holdings (ATAT) flirted with a buy point before closing just below the entry.
Nvidia is a hedged position on IBD Leaderboard, with Tesla stock and Astera Labs on the Leaderboard watchlist. Nvidia stock is on SwingTrader. Astera Labs stock, Nvidia, Broadcom and Atour Lifestyle are on the IBD 50. Broadcom stock is on the IBD Big Cap 20. Atour stock is on IBD Sector Leaders. Nvidia was Tuesday’s IBD Stock Of The Day.
The video embedded in this article discusses Tuesday’s market action and analyzes Nvidia, Atour Lifestyle and Fiserv (FI).
Dow Jones Futures Today
Dow Jones futures fell 0.6% vs. fair value. S&P 500 futures declined 0.45% and Nasdaq 100 futures retreated 0.5%.
The 10-year Treasury yield rose to 4.62%.
Bitcoin fell back below $96,000.
Most stock markets around the world were closed Wednesday for the Christmas holiday. Many also are shut on Dec. 26, including most European markets and Hong Kong.
Remember that overnight action in Dow futures and elsewhere doesn’t 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 saw the Nasdaq lead a broad rally Tuesday. This was the start of the unofficial Santa Claus rally period, which marks the last five trading days of the year and the first two sessions of next year.
The Dow Jones Industrial Average climbed 0.9% in Tuesday’s stock market trading, moving back toward the 50-day line. The S&P 500 index gained 1.1%, back above its 21-day line and the 6,000 level. The Nasdaq composite jumped 1.35%, its third strong session as it moves back toward record highs.
The small-cap Russell 2000 ran up 1%, but is still some distance from its 50-day line.
The Invesco S&P 500 Equal Weight ETF (RSP) advanced 0.75%, looking a lot like the Russell 2000.
The First Trust Nasdaq 100 Equal Weighted Index ETF (QQEW) popped 1.15%, nearing the 50-day line like the Dow Jones.
Meanwhile, the CBOE Volatility Index, or VIX, has plunged since spiking to a four-month high last Wednesday. The market fear gauge is near recent lows, suggesting a high level of bullishness.
U.S. crude oil prices rose 1.2% to $70.10 barrel.
The 10-year Treasury yield edged down 1 basis point to 4.58%, reversing from a fresh multimonth high of 4.63%. So far rising yields haven’t stopped the S&P 500 and Nasdaq, though that could be a factor for why the Dow, Russell and equal-weight ETFs are below their 50-day lines.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF (FFTY) jumped 2.3%. The iShares Expanded Tech-Software Sector ETF (IGV) rallied 1.15%. The VanEck Vectors Semiconductor ETF (SMH) advanced 0.9%. Nvidia stock is the No. 1 holding in SMH, with Broadcom also a key component.
ARK Innovation ETF (ARKK) leapt 2.9% and ARK Genomics ETF (ARKG) gained 0.9%. Tesla stock is a major holding across Ark Invest’s ETFs. Cathie Wood’s Ark also has a big Nvidia stake.
SPDR S&P Metals & Mining ETF (XME) rose 0.3%. SPDR S&P Homebuilders ETF (XHB) climbed 0.5%. The Energy Select SPDR ETF (XLE) was up 0.85% and the Health Care Select Sector SPDR Fund (XLV) increased 0.4%.
The Industrial Select Sector SPDR Fund (XLI) moved 0.8% higher. The Financial Select SPDR ETF (XLF) rallied 1.2%.
Nvidia Stock
Nvidia stock edged up 0.4% to 140.22, hitting 141.90 intraday. While a slim gain Tuesday, the AI chip giant is up 10.5% since hitting a low of 126.86 on Dec. 17. NVDA stock has retaken the 50-day line and broken a short downtrend, offering an early entry. But investors might want to see a little more strength.
NVDA stock lost about 1% early Thursday, back below the 50-day line.
At the end of this week, Nvidia is on track to have a shallow double-bottom base with a 146.54 buy point.
However, Nvidia isn’t the AI chip leader right now. Broadcom stock gained 3.15% Tuesday, moving back toward record highs amid a 48% surge so far in December.
AI chip IPO Astera Labs stock popped 4.45% Tuesday to a fresh high, on track for its fourth straight big monthly gain.
Time The Market With IBD’s ETF Market Strategy
Tesla Stock
Tesla stock jumped 7.4% to 462.28 after Monday’s 2.3% bounce. Shares are moving back toward last Wednesday’s record 488.54. Tesla China sales remain strong as the EV giant seeks a record quarter for deliveries worldwide. But the momentum in TSLA stock has been about optimism about self-driving, AI, robotics and what the Trump administration will do to help key supporter and advisor Elon Musk.
TSLA stock edged higher early Thursday.
What To Do Now
The stock market rally is in good shape, but it’s somewhat narrow. Megacaps such as Tesla and Broadcom are propping up the Nasdaq and S&P 500, while a number of hot stocks are powering higher. But much of the market still seems subdued, if not damaged.
You want to pay attention to market divergence, because that can be unstable. But you don’t want to ignore the areas of strength. It’s definitely a stock picker’s market, so make sure to pick the right stocks. Obviously AI plays are hot again but there are areas in travel, finance, retail and more that are looking strong as well.
Enjoy the holiday, and keep working on your “nice” list of stocks, crossing off those that are naughty.
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.
YOU MAY ALSO LIKE:
Why This IBD Tool Simplifies The Search For Top Stocks
Catch The Next Big Winning Stock With MarketSurge
Best Growth Stocks To Buy And Watch
IBD Digital: Unlock IBD’s Premium Stock Lists, Tools And Analysis Today
