Dow Jones futures rose slightly early Tuesday, along with S&P 500 futures and Nasdaq futures. Chinese stocks and key commodities fell as China fiscal stimulus disappointed.
The stock market rally fell back Monday as the 10-year Treasury yield moved above 4%.
Nvidia rose solidly, flashing some early buy signals. Tesla fell back, carving a handle ahead of its long-awaited robotaxi event. Apple retreated to key support after Jefferies analyst Edison Lee said iPhone 16 and 17 expectations are "too high."
Insurance stocks were big losers as Hurricane Milton is tracking toward Tampa, Florida with a Wednesday landfall.
Nvidia stock is on IBD Leaderboard, SwingTrader and the IBD 50.
Dow Jones Futures Today
Dow Jones futures were 0.1% above fair value. S&P 500 futures climbed 0.4% and Nasdaq 100 futures rose 0.5%.
The 10-year Treasury yield nudged higher to 4.04%.
Crude oil futures fell 2%, while copper prices lost more than 2%.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
China Stimulus
On Tuesday, China's National Development and Reform Commission mentioned some incremental fiscal stimulus that didn't satisfy investors. Hong Kong's Hang Seng Index dived 9.4%. The Hang Seng had surged since late September amid rate cuts and various measures to encourage lending, property buying and Chinese shares.
The Shanghai exchange reopened after being shut for five trading days for national holidays. The Shanghai composite initially skyrocketed in Tuesday's return, but finished up 4.6%, far off highs.
Chinese stocks, including those that trade in the U.S. such as Alibaba and Tesla rival BYD, have raced higher. But most are headed sharply lower Tuesday.
Miners surged initially on China stimulus moves, but have paused for the past few sessions. Copper giant Freeport-McMoRan has forged a handle buy point, but is off significantly early Tuesday.
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Stock Market Rally
The stock market rally retreated Monday, giving up most or all of Friday's solid gains.
The Dow Jones Industrial Average retreated 0.9% in Monday's stock market trading. The S&P 500 index lost nearly 1%. The Nasdaq composite fell 1.2%, back below the 18,000 level.
Apple stock fell 2.25% to 221.69, undercutting its 50-day moving average. That weighed on all the major indexes, though Nvidia provided some support to the S&P 500 and Nasdaq. The major indexes did hold their 21-day moving averages.
The small-cap Russell 2000 fell 0.9%, just below its 21-day line.
All four indexes remain within a trading range of the past few weeks, though the Russell is getting near the low of its band.
There weren't many breakouts or buy signals, though Nvidia stock and Generac Holdings were exceptions. Many leaders are pausing along with the market, forging handles or tight patterns or pulling back to key support.
U.S. crude oil prices jumped 3.7% to $77.14 a barrel.
The 10-year Treasury yield rose 4.5 basis points to 4.025%, closing above the 4% level for the first time since the end of July. Treasury yields surged last week as a strong jobs report and other economic data eased downside fears, leading investors to price out another big Fed rate cut. Markets now see a small chance that the Fed will take no action at the Nov. 6-7 meeting.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF fell 0.55%. The iShares Expanded Tech-Software Sector ETF declined 1.4%. The VanEck Vectors Semiconductor ETF edged up 0.2%. Nvidia stock is the top holding in SMH.
The ARK Innovation ETF retreated 1.4% and ARK Genomics ETF lost 0.7%. Tesla stock is still a big holding across Ark Invest's ETFs. Cathie Wood also has built up a sizable Nvidia stock stake. Ark Invest also owns a small stake in BYD, one of two stocks that both Cathie Wood and Warren Buffett own.
SPDR S&P Metals & Mining ETF inched up 0.2%. U.S. Global Jets ETF descended 0.3%. SPDR S&P Homebuilders ETF closed just below break-even. The Energy Select SPDR ETF advanced 0.35% and the Health Care Select Sector SPDR Fund declined 0.4%.
The Industrial Select Sector SPDR Fund dipped 0.2%. The Financial Select SPDR ETF retreated 1.2%.
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Nvidia Stock Clears Buy Points
Nvidia stock gained 2.3% to 127.78 on Monday, coming off intraday highs as market losses picked up. Shares have rallied 9.2% in a four-day win streak and bounce off the 50-day line.
Monday's move cleared a trendline entry around 126 as well as the Sept. 26 short-term high of 127.67, which could viewed as a handle buy point. The Aug. 26 high of 131.26 also could serve as an NVDA stock buy point.
Nvidia rose modestly early Tuesday.
Nvidia CEO Jensen Huang will give the keynote address at CES in Las Vegas on Jan. 6, 2025, the Consumer Technology Association said Tuesday. On Oct. 2, Huang said that Blackwell, the next-generation AI chip, is in "full production" with demand "insane."
Tesla Stock
Tesla stock fell 3.7% to 240.83 on Monday, slightly below its 21-day line. The EV giant now has a 264.86 cup-with-handle buy point on a daily and weekly chart, according to MarketSurge.
Shares fell 4% last week after Tesla deliveries missed whisper numbers. TSLA stock rebounded Friday from near the 21-day line.
Ideally, Tesla stock wouldn't make a decisive move until after Thursday night's Tesla robotaxi event.
Overnight, Tesla introduced the Model 3 Long Range Rear Wheel Drive variant in several European countries, including Germany, France, the U.K., Norway and the Netherlands. It also cut the price of the base Model 3 Standard Range by 3.6% in France, 5.75% in the Netherlands and 5.9% in Germany.
What To Do Now
The stock market rally had solid losses Monday, but the key indexes are still in a tight range with leading stocks acting well. This could be a bullish pause before another leg in the bull run, but wait for that strength.
Investors on Monday could have bought or added to Nvidia or one of the other stocks flashing buy signals, but it wasn't a time to get especially aggressive.
Focus on your watchlists and reviewing your portfolio. Be ready to take advantage if the market revs higher. If you're already heavily exposed, your might identify some relative laggards to sell if you need to make room.
If the market breaks lower, you'll want to have your game plan in place, especially for your weaker holdings.
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.
