Dow Jones futures and Nasdaq futures fell slightly early Friday, while S&P 500 futures were little changed. Nike plunged on mixed earnings late. The Fed's favorite inflation gauge headlines Friday economic data.
The stock market rally rebounded Thursday, with the indexes trading within the range of Wednesday's violent sell-off.
AAPL stock edged lower, holding just above a buy point. As expected. Apple stopped sales of some Apple Watch models due to a patent dispute. Carnival Corp. cleared an early buy point on earnings. Google parent Alphabet reclaimed a buy point. Microsoft is holding in a buy zone. Novo Nordisk is moving toward a buy point while Super Micro Computer appears to be working on a handle.
Overall buying opportunities are limited. Generally, it's a time to be holding steady, perhaps taking some partial profits, while awaiting the market's next move.
MSFT stock is on IBD Leaderboard. CCL stock is on SwingTrader. Microsoft stock is on IBD Long-Term Leaders. Carnival, Super Micro and NVO stock are on the IBD 50. Carnival also was Thursday's IBD Stock Of The Day.
Bristol Myers Squibb will buy neuroscience drug developer Karuna Therapeutics for $14 billion, or $330 a share cash. Karuna has a schizophrenia drug up for FDA approval. KRTX skyrocketed.
NetEase plunged in U.S. trading, leading a sell-off as China imposed new gaming restrictions. Tencent Holdings and Bilibili also are among those hard hit. The news also impacted Chinese e-commerce firms and for-production education stocks amid fears of a new wave of government restrictions.
Dow Jones Futures Today
Dow Jones futures fell 0.25% vs. fair value, with NKE stock a drag. S&P 500 futures edged higher and Nasdaq 100 futures lost a fraction.
The 10-year Treasury yield fell to 3.86%. Crude oil futures rose slightly.
The PCE inflation readings and other economic data before the open will be sure to swing Dow futures and Treasury yields before the open.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
Nike Earnings
NKE stock plunged more than 10%overnight as Nike earnings topped views while revenue was in line. The Dow Jones apparel and shoe giant slashed its sales forecast, citing weakening consumer spending, and announced a big cost-cutting plan. Nike stock advanced 0.9% to 122.53 on Thursday, still building the right side of a long cup base. Shares have a 131.31 buy point.
The Nike revenue and consumer warning hit rival shoe stocks such as On Holding, Deckers, Crocs, as well as athletic apparel play Lululemon Athletica.
PCE Inflation
The November PCE price index is due Friday at 8:30 a.m. ET. Economists expect a 0.1% decline vs. October, with the yearly gain nudging down to 2.9%. The core PCE price index, the Fed's favorite inflation measure, is seen rising 0.2% on the month. Core PCE inflation should tick down to 3.4%.
The PCE price index is part of the Commerce Department's income and spending report. Personal income is forecast to climb 0.4% with spending up 0.3%.
Commerce will release the durable goods orders at the same time. Overall orders are seen bouncing 2.4% after October's 5.4% tumble. Orders excluding transportation items should rise 0.2% after a flat October. Core capital goods orders are seen edging up 0.1% after October's 0.3% decline.
At 10 a.m. ET, new-home sales are expected to show a slight November gain to an annual rate of 690,000 from October's 679,000.
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Stock Market Rally
After Wednesday's sharp, downside reversal, the expectation was that selling would continue. But this market doesn't want to pull back, rebounding Thursday and closing at session highs.
The Dow Jones Industrial Average climbed 0.9% in Thursday's stock market trading. The S&P 500 index bounced 1%. The Nasdaq composite jumped 1.3%. The small-cap Russell 2000 leapt 1.7%.
For all these indexes, it was an inside day, trading comfortably within Wednesday's range. So it's hard to take too much meaning from Thursday's action. Perhaps the market will pause or pullback modestly over several days or sessions. That could be ideal, letting the indexes catch their breath and allow leading stocks to forge new buying opportunities.
This is a natural place for the indexes to pause. The S&P 500 is just below record highs. The Nasdaq is trading around the 15,000 level and is still somewhat extended from the 50-day line. The Russell 2000 is hitting resistance just above the 2,000 level.
U.S. crude oil prices dipped 0.4% to $73.89 a barrel.
The 10-year Treasury yield edged higher to 3.89% after falling as low as 3.83%.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF climbed 1.4%, with MSFT stock a major component. The VanEck Vectors Semiconductor ETF leapt 2.5%.
Reflecting more-speculative story stocks, ARK Innovation ETF bounced 2.55% and ARK Genomics ETF gained 3%.
SPDR S&P Metals & Mining ETF rose 2.3%. U.S. Global Jets ETF ascended 2%. SPDR S&P Homebuilders ETF climbed 1.4%. The Energy Select SPDR ETF edged up 0.4% and the Health Care Select Sector SPDR Fund advanced 1.2%,
The Industrial Select Sector SPDR Fund and Financial Select SPDR ETF both bounced 1%.
Microsoft's Cybersecurity Business Is Booming. Critics Say It's The Problem.
Apple Stock
Apple stock dipped 0.1% to 194.68, holding above a 192.93 cup-with-handle buy point with a rising 21-day moving average just below that. As expected, Apple stopped selling its Apple Watch Series 9 and Ultra 2 on its U.S. website. That follows orders from the International Trade Commission, which found that those Apple Watch models' blood oxygen sensor infringes intellectual property rights of Masimo. That means Apple isn't selling key consumer products in the final days of the holiday season.
Stocks Near Buy Points
Carnival stock jumped 6,2% to 19.19 on Thursday. Shares nearly hit a 19.55 cup-base buy point, according to MarketSmith analysis. Investors could use the Dec. 14 high of 19.23 as an early entry from a not-quite handle. Shares cleared that entry intraday, though it closed just below that level. Early Thursday, Carnival reported a smaller-than-expected loss while reporting strong revenue and guidance.
Google stock rose 1.5% to 140.42, above a 139.42 cup-with-handle buy point. Shares broke out Wednesday morning on a report of a possible ad sales revamp, but slashed gains in Wednesday's sell-off. The relative strength line has lagged for the past two months, but has started picking up again.
Microsoft stock edged up 0.8% to 373.54, continuing to hug the 21-day moving average as the 50-day line closes the gap. Shares are still holding in range from a 366.78 cup-base buy point, first cleared on Nov. 10. Investors might want to wait for MSFT stock to clear a short trendline, using Wednesday's high of 376.03 as a specific entry.
Novo Nordisk stock climbed 2.1% to 103.48. Shares are close to retaking a prior 104 buy point from a flat base, though that's technically no longer valid. NVO stock could be working on a new flat base, which would have a 105.69 entry. Novo Nordisk has strengthened over the past two weeks, while weight-loss drug rival Eli Lilly is stuck below the 50-day.
Super Micro stock edged up 0.7% to 304.18, fading from intraday highs. The AI server play appears to be working on a handle right around key levels after a strong five-day rally. SMCI stock is tightening up after some wild swings earlier in the consolidation.
What To Do Now
The stock market rally is still solidly intact. But there aren't many buying opportunities while the very short-term market trend is unclear following Wednesday's reversal. It's good to game out potential scenarios, but ultimately you need to take the market day by day.
Investors might want to take some profits, but a lot will depend on your current holdings and your investing style. There are plenty of reasons to remain heavily invested.
Keep working on watchlists for developing setups. Leading stocks could quickly form handles or bullish pullbacks if the market takes a breather.
Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
Please follow Ed Carson on X/Twitter at @IBD_ECarson, Threads at @edcarson1971 and Bluesky at @edcarson.bsky.social for stock market updates and more.
