The Dow Jones pared gains early Wednesday, along with the S&P 500 and the Nasdaq after Nvidia reported another quarter of huge earnings and strong guidance. Key economic data came in mixed.
Nvidia stock fell solidly early Wednesday, still within a buy zone. Other key AI plays near buy points rose, including Microsoft, Advanced Micro Devices, Google parent Alphabet, Meta Platforms. But Palantir Technologies and Super Micro Computer reversed lower.
Meanwhile, Sam Altman is returning as CEO of Microsoft-backed OpenAI, just days after the board ousted him.
Tesla fell Wednesday, backing off possible buy points.
Urban Outfitters and Autodesk fell Wednesday morning after earnings, signaling moves below buy zones. Guess plunged after closing just below a buy point. Deere tumbled on weak guidance.
Microsoft stock, Nvidia and Meta Platforms are in the current IBD Leaderboard line up META stock is listed on SwingTrader. MSFT stock is on the IBD Long-Term Leaders list. Nvidia stock, Microsoft, Novo Nordisk and Super Micro are current IBD 50 listings. Microsoft, Palo Alto, Meta Platforms and SMCI stock are on the IBD Big Cap 20.
Economic Data
At 8:30 a.m. ET, the Labor Department reported initial jobless claims tumbled 24,000 to 209,000, well below views.
Meanwhile, the Commerce Department reported October durable goods orders tumbled 5.4%, worse than expected. Orders excluding transportation were flat, just below views.
Dow Jones Today
The Dow Jones climbed 0.3%, even as Caterpillar fell, pulled down by Deere's outlook. S&P 500 rose 0.2%. The Nasdaq advanced 0.3%, but well off early highs. Nvidia stock is a major S&P 500 and Nasdaq 100 component, along with many other AI plays, as well as Tesla stock.
The 10-year Treasury yield edged up to 4.43% after skidding to two-month lows earlier.
Crude oil futures dived 5% to about $74 a barrel. OPEC+ delay an upcoming meeting from Nov. 25-26 to Nov. 30. That followed buzz that the cartel could announce new production cuts. Weekly oil inventory data is due out from the Energy Information Administration at 10:30 a.m. ET.
Israel and Hamas have agreed to four-day cease-fire, starting Thursday, with Hamas agreeing to turn over some 50 hostages.
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Stock Market Rally
The stock market rally took a breather Tuesday, but the major indexes and leading stocks still looked healthy.
The Dow Jones Industrial Average and S&P 500 slipped 0.2% in Tuesday's stock market trading. The Nasdaq fell 0.6%. The small-cap Russell 2000 slumped 1.3%.
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Tesla Stock
TSLA stock fell 3% early Wednesday, back below the 50-day line. On Tuesday, shares rose 2.4% to 241.20, retaking the 50-day line amid solid weekly China registrations and progress on a possible future India plant. A Cybertruck delivery event looms Nov. 30, though CEO Elon Musk and top executives have downplayed expectations for the vehicle.
A Florida judge found "reasonable evidence" that Musk and other managers knew that Tesla Autopilot was defective, Reuters reported Tuesday night. The ruling, which took place last week, means a Florida lawsuit involving a Model 3 fatal crash in 2019 can go forward.
Tesla stock has a 278.98 buy point from a double-bottom base. There is a trendline running from the July 19 high that could offer an early entry, currently around 253. Investors could use a move above the Nov. 15 intraday high 246.70 as an aggressive entry or area to start a position.
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Nvidia Stock
Nvidia stock fell 4% Wednesday morning after wavering before the open. Shares dipped 0.9% to 499.44 on Tuesday, in range of a 476.09 buy point from a double-bottom base.
Late Tuesday, the AI chip leader reported Q3 revenue spiked 206% to $18.12 billion, while earnings skyrocketed 593%, both crushing views once again. Nvidia also guided higher for Q4.
Nvidia earnings and guidance sprinted past views in the prior two quarters, so investors may have been hoping for even more.
Still, several analysts raised NVDA stock price targets.
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Sam Altman Back As OpenAI CEO
Sam Altman will return as OpenAI CEO, just five days after his abrupt exit. Former Salesforce co-CEO Bret Taylor and former Treasury Secretary Larry Summers will join OpenAI's revised board.
OpenAI's board ousted Altman on Friday, but a day later was in talks to bring him back as big investors like Microsoft and key staff rebelled. Microsoft said Monday it would hire Altman and fellow co-founder Greg Brockman to form a new AI lab. The vast majority of OpenAI staff threatened to quit to work for Altman at Microsoft.
AI Stocks
Microsoft stock edged higher. Shares fell 1.2% to 373.07 on Tuesday, in range of a 366.78 cup-base buy point.
The end of the OpenAI drama is likely a positive for Microsoft and MSFT stock.
AMD stock rose modestly, flirting with a breakout. Shares sank 1.9% to 119.18 on Tuesday. The Nvidia rival has a 122.41 cup-with-handle buy point.
Google stock edged higher. Shares climbed 0.5% Tuesday to 136.97. Investors could use Thursday's high of 137.22 as an early entry. The official flat-base buy point is 141.22.
Meta stock rose 1%. Shares edged down 0.9% on Tuesday, within the buy zone of a consolidation going back to late July.
PLTR stock declined slightly. Shares tumbled 7.2% to 19.80 on Tuesday in an ugly reversal. Palantir stock fell back below a 20.24 cup buy point, according to MarketSmith analysis.
SMCI stock fell modestly after initially rising early Wednesday. Shares fell 4.8% to 289.85 on Tuesday after jumping 5.55% on Monday, arguably offering an early entry. Super Micro stock has a 317.50 buy point from an awkward double-bottom base.
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.
