Dow Jones futures remained largely unchanged, similar to S&P 500 futures and Nasdaq futures.
The stock market rally managed to recover from a slight loss to finish marginally higher, despite ongoing tensions in the Middle East. The Nasdaq has found stability at its 21-day moving average for the second consecutive session.
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Tesla (TSLA) experienced a decline on Wednesday as deliveries did not meet anticipated figures, though TSLA stock bounced back from critical support levels.
Nvidia (NVDA) saw an uptick after testing support, along with fellow AI chip leaders Taiwan Semiconductor (TSM) and Broadcom (AVGO). Nvidia stock made a slight gain overnight as CEO Jensen Huang highlighted the “insane” demand for the next-generation Blackwell AI chips.
Royal Caribbean (RCL) and Cava Group (CAVA) also recovered from their lows, maintaining critical levels.
Nvidia stock features on the IBD Leaderboard, with Cava included in the Leaderboard watchlist. Cava stock appears on SwingTrader. Both Nvidia and Royal Caribbean stocks are part of the IBD 50, while Broadcom stock features on the IBD Big Cap 20.
Dow Jones Futures Today
Dow Jones futures slightly declined compared to fair value. S&P 500 futures and Nasdaq 100 futures remained flat.
Crude oil prices increased by 1%.
Keep in mind that overnight activity in Dow futures and other markets may not directly reflect movements in the following regular stock market session.
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Stock Market Rally
The stock market rally had a relatively calm session, ending with minimal change.
The Dow Jones Industrial Average increased by 0.1% during Wednesday’s stock market trading. The S&P 500 index rose by less than one point, while the Nasdaq composite also climbed by 0.1%. The small-cap Russell 2000 dipped by 0.1%.
The Dow Jones and S&P 500 are still hovering just below last week’s record highs, with the S&P finding support above the 21-day line and the peak of a previous consolidation. The Nasdaq is maintaining its position at the 21-day line, though it remains below the 18,000 threshold. The small-cap Russell 2000 wrapped up just above its 21-day line, close to the 50-day line.
It’s no surprise that Nvidia, Tesla, and numerous other stocks are finding support around their 21-day lines as the Nasdaq does as well.
U.S. crude oil prices advanced by 0.4% to $70.10 per barrel, well below intraday highs.
The 10-year Treasury yield climbed four basis points to 3.78%. The ADP Employment Report indicated stronger-than-anticipated private-sector hiring in the previous month. The jobs report for September is scheduled for release on Friday.
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ETFs
Among growth ETFs, the Innovator IBD 50 ETF (FFTY) increased by 0.15%. The iShares Expanded Tech-Software Sector ETF (IGV) surged by 0.9%. The VanEck Vectors Semiconductor ETF (SMH) rebounded by 1.4%. Nvidia is the top holding in SMH, alongside key members Broadcom and Taiwan Semiconductor.
In the realm of more speculative story stocks, the ARK Innovation ETF (ARKK) decreased by 0.7% while the ARK Genomics ETF (ARKG) slightly rose. Tesla stock remains a significant holding across Ark Invest’s portfolios. Cathie Wood has built a substantial position in Nvidia stock as well.
The SPDR S&P Metals & Mining ETF (XME) fell by 0.5%. The U.S. Global Jets ETF (JETS) dropped by 1.2%. The SPDR S&P Homebuilders ETF (XHB) decreased by 0.8%, while the Energy Select SPDR ETF (XLE) climbed by 1%.
The Health Care Select Sector SPDR Fund (XLV) and the Industrial Select Sector SPDR Fund (XLI) each dipped by 0.2%. The Financial Select SPDR ETF (XLF) marginally increased by 0.1%.
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Tesla Deliveries
Tesla deliveries increased by 6% compared to the previous year, totaling 462,890 in the third quarter, which is roughly in line with various official projections. However, this figure fell short of “whisper” estimates of 465,000-470,000 or higher.
Additonally, Tesla reported the deployment of 6.9 gigawatt-hours (GWh) of energy storage in the third quarter, a significant drop from the record 9.4 GWh in Q2. Nonetheless, this marks a 70% increase compared to a year earlier.
Tesla Falls On Deliveries While BYD Soars On Surging Sales
Tesla Stock
Tesla stock dropped 3.5% to 249.02. Shares plunged as low as 241.50 shortly after the market opened, but found support just above the 21-day line. TSLA stock has a 271 cup-base buy point. However, it could be forming a handle that might reduce the entry price and allow moving averages to catch up.
Ideally, Tesla stock would create a handle ahead of the Oct. 10 robotaxi event, which is expected to significantly influence the stock price.
Nvidia Stock, AI Chips
Nvidia stock rose by 1.6% to 118.85, rebounding from its 50-day moving average and regaining the 21-day line. Investors could consider the Sept. 26 high of 127.67 as a trendline entry or a handle buy point. The Aug. 26 high of 131.26 could also serve as a buy point.
NVDA stock edged up slightly overnight after CEO Huang remarked to CNBC that “Blackwell is in full production, and demand for Blackwell is insane and ‘on-schedule’. Everyone wants to be the first to get their hands on it.”
Huang has consistently expressed optimism regarding Blackwell’s production and demand in recent weeks.
Taiwan Semiconductor stock surged by 2.2% to 175.80. TSM stock regained the 21-day line and a 175.45 cup-with-handle buy point, according to MarketSurge analysis. The Nvidia chipmaker had a strong breakout last week, but subsequently fell back in the past three sessions. Taiwan Semi is expected to report Q3 sales next week and Q3 earnings the week after.
Broadcom stock increased by 1.9% to 170.66, bouncing back from the 21-day line. AVGO stock has a 185.16 consolidation buy point, but it is likely to form a handle after Thursday’s trading, which would lower the buy point to 180.25.
TSM and Broadcom stocks saw slight gains late in response to Huang’s comments.
Other Stocks To Watch
Royal Caribbean stock ended 1% higher at 174.96 after initially dipping below its 21-day line and nearly testing a 169.47 cup-with-handle buy point.
Cava stock rose 0.4% to 122.92 after falling to 118.62 in the morning, briefly dropping below the 21-day line. This recent pullback has been a healthy reset after shares surged for several weeks to the Sept. 23 record high. A move above the October one high could present an aggressive entry point or a chance to add shares.
Rules For When To Buy And Sell Stocks In Bull And Bear Markets
What To Do Now
Unless you’re a highly agile trader, this week has not offered much incentive to purchase stocks. Investors may have reduced their exposure, especially if recent purchases triggered sell rules, but for the most part, it’s been a time for observation.
A couple of favorable sessions could position key indexes and leading stocks in a bullish trajectory. Several potential handles and pullbacks are forming. However, a negative day could inflict significant damage on the Nasdaq and Russell 2000, as well as on stocks like Nvidia.
With this in mind, ensure you’re monitoring those developing setups, while also having your exit strategies ready.
Read The Big Picture daily to stay aligned with market direction and leading stocks and sectors.
Please follow Ed Carson on Threads at @edcarson1971 and on X/Twitter at @IBD_ECarson for stock market updates and more.
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