Dow Jones futures rose solidly early Monday, along with S&P 500 futures and Nasdaq futures. Apple, Oracle, Palantir Technologies, Dell Technologies and Tesla will be in focus on key news.
The stock market rally is reeling amid fears about the economy and the artificial intelligence boom, as well as a still-unwinding carry trade. The S&P 500 and Dow Jones suffered their worst weekly losses since March 2023 while the Nasdaq had its biggest sell-off since January 2022, led by Nvidia.
Tesla stock, which bucked the trend with a strong Thursday, gave it all back Friday and then some.
Investors should be reducing exposure and ready to do more, but also paying attention to stocks showing relative strength and holding key levels.
Dow Jones Futures Today
Dow Jones futures advanced 0.6% vs. fair value. S&P 500 futures climbed 0.6% and Nasdaq 100 futures rose 0.6%.
The 10-year Treasury yield climbed to 3.75%. Crude oil futures rose 1%, copper popped more than 1%.
Chinese consumer prices rose 0.6% in August vs. a year earlier, just below views. Producer prices fell 1.8%, more than expected.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
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AI Stocks In The News
The Apple iPhone 16 will be unveiled at a 10 a.m. PT product event. It'll be the Dow tech giant's first AI-enabled handset. It reportedly will have a new chip using the latest designs from Arm Holdings.
Oracle earnings are due after Monday's close. Oracle stock bucked the trend, edging higher last week as it works toward a traditional buy point.
Meanwhile, Palantir and Dell will be active Monday on news that the two AI tech plays will join the S&P 500 index before the open on Sept. 23, along with insurance broker Erie Indemnity. Palantir stock and Dell jumped early Monday, with the former trading near three-year highs.
Also, Elon Musk denied a report that his xAI startup has discussed sharing Tesla revenue from FSD and more.
Early Tuesday, Nvidia chipmaker Taiwan Semiconductor will release August sales figures. Taiwan Semi, which also makes chips for Apple and many others, has seen growth revive on AI and other advanced chips. TSM stock has a cup-with-handle base, according to MarketSurge. But shares sold off 8.7% last week, well below their 50-day.
Thursday night, Adobe reports. Adobe stock flirted with a buy point last week, pulling back to its 21-day line.
These reports will give an indication about AI demand by companies and by end users, allaying or intensify fears about an AI slowdown.
Nvidia stock is on IBD Leaderboard, though the position is hedged. Palantir stock is on the IBD 50.
Inflation Reports
The Labor Department will release the consumer price index early Wednesday and the producer price index before Thursday's open. The Federal Reserve has pivoted toward job and economic weakness vs. inflation concerns, but tame readings could give policymakers ammo for making a big Fed rate cut on Sept. 18. Currently, markets are forecasting a quarter-point cut.
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Stock Market Rally
The stock market rally shattered bullish trends in the past week. The Dow Jones Industrial Average tumbled 2.9% in last week's stock market trading, falling below its 21-day line and approaching its 50-day. The S&P 500 index lost 4.25% and the small-cap Russell 2000 gave up 5.7%, both sinking clearly below their 50-day lines.
The Nasdaq composite plunged 5.8%, far below its 50-day line and nearing its 200-day. On Friday, the tech-heavy index knifed below the low of its Aug. 13 follow-through day. Closing below the low of the FTD is a very negative sign for a market rally. The S&P 500 has not closed below its Aug. 13 FTD low, but it's getting close.
A bounce wouldn't be a surprise after heavy selling over the past several days, but the market needs more than one good day to start looking healthier.
Nvidia stock, the most important company and stock of the past two years, plummeted 13.9% to 102.83 after tumbling 7.7% in the prior week.
The 10-year Treasury yield dived 20 basis points last week to 3.71%, a 52-week closing low. The yield curve is no longer inverted, with the two-year Treasury yield plunging 275 basis points to 3.65%.
U.S. crude oil futures sold off 8% to $67.67 a barrel, the lowest since June 2023. Gasoline futures are at three-year lows.
Apple iPhone 16 Headlines AI News
Apple iPhone 16
Apple will show off its iPhone 16 smartphone at a Monday product event at 10 a.m. PT. This will be the first iPhone with AI tech. There's hope that the AI-enhanced handset will trigger a huge wave of new iPhone upgrades.
Apple also should show off its latest Apple Watch smartwatches and new AirPods wireless earbuds.
Apple stock fell 3.6% last week to 220.82, back below its 50-day line. AAPL stock now has a V-shaped cup-with-handle base with a 232.92 buy point. It's a base-on-base formation to a prior cup base.
Shares edged higher before the open.
The Apple iPhone event, and the AAPL stock reaction, will be key for iPhone chipmakers, including Arm stock, as well as AI plays generally.
Oracle Earnings
Oracle earnings are due Monday night. The database software giant likely will discuss AI wins on the earnings call or at a conference later in the week.
ORCL stock edged up 0.4% last week to 141.81, holding above its key moving averages. Oracle is working on a 146.59 consolidation buy point.
Shares rose a fraction in premarket trade.
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Tesla, Musk's xAI
Tesla could license AI models from Musk's xAI for its Full Self-Driving software and share some of that revenue in exchange for using the startup's AI models, The Wall Street Journal reported Saturday, citing sources.
However, Elon Musk, posting on his social site X, said possible revenue sharing is "not accurate."
Last week, Tesla stock fell 1.6% to 210.73 in a round trip. On Thursday, shares popped above their 50-day line and cleared a 238.22 short-term high, buoyed by robust China sales and the EV giant's FSD rollout plans. That offered an aggressive entry for TSLA stock.
On Friday, Tesla plunged 8.45%, back below the 50-day line.
Shares rose modestly before Monday's open.
Tesla stock has a 271 cup-base buy point, according to MarketSurge.
What To Do Now
This is not a good time to be buying stocks. While some areas, especially defensive and defensive growth names, are faring better than tech growth names, the vast majority of stocks will follow the market.
Investors should have a slim-to-modest exposure, largely avoiding tech aside from longer-term holdings.
But if the market does revive soon, a large number of stocks will be flashing buy signals. That could include Apple, Oracle, Adobe, Palantir stock and even names such as Taiwan Semiconductor, but also a slew of names in the housing, finance and medical fields, just to name a few.
So have your watchlists up to date. The stocks that hold up the best in a tough market often lead the next uptrend. But today's resilient or standout performers can quickly crumble, as Tesla stock did on Friday.
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