Dow Jones futures edged lower Monday morning, while S&P 500 futures and Nasdaq futures rose slightly.
The stock market rally had a solid week, building on the prior week's strong gains. With the Federal Reserve opting for a big rate cut, the S&P 500 and Dow Jones set record highs, while the Nasdaq and Russell 2000 are now decisively above their 50-day lines.
Most of all, dozens of leading stocks broke out or flashed buy signals.
Meta Platforms, Royal Caribbean, Spotify, Apple, Evercore and Tesla are all actionable, though their charts vary.
Nvidia fell modestly last week, fighting around a key support level. Nvidia stock is not leading but is still important for the market and especially for AI stocks.
Investors should be looking to build up to heavy exposure — gradually — shifting portfolios more toward growth.
Nvidia and Meta stock are on IBD Leaderboard. Spotify stock and Royal Caribbean are on SwingTrader. Nvidia, Royal Caribbean and Meta Platforms are on the IBD 50. Meta Platforms was Friday's IBD Stock Of The Day.
The video embedded in the article discusses the bullish market action in depth, while analyzing Constellation Energy, Spotify and Apple stock.
Dow Jones Futures Today
Dow Jones futures were just below fair value. S&P 500 futures climbed 0.1% and Nasdaq 100 futures rose 0.2%.
The 10-year Treasury yield climbed a few basis points to 3.75%.
China's central bank overnight cut a 14-day reverse repo rate by 10 basis points to 1.85%.
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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Stock Market Rally
The stock market rally had solid gains this past week, mostly on Thursday's belated jump on the big Fed rate cut.
The Dow Jones Industrial Average rose 1.6% in last week's stock market trading. The S&P 500 index advanced 1.4%. The Nasdaq composite gained 1.5%. The small-cap Russell 2000 jumped 2.1%.
The S&P 500, Dow Jones and the Invesco S&P 500 Equal Weight ETF hit record highs Thursday, pulling back modestly Friday.
The Nasdaq and Russell 2000 are now decisively above their 50-day moving averages. Both topped their late-August short-term highs on Thursday but ended the week just below those levels. The Nasdaq is also back below the 18,000 level.
A pause at current levels would be normal and healthy, perhaps allowing leading stocks to forge handles or other entries.
Broadly speaking, there's been a shift from defensive sectors into growth, including aggressive growth. Homebuilders and financials continue to do well, along with aerospace and other industrials.
The 10-year Treasury yield climbed 8 basis points to 3.73% after hitting a 52-week low on Tuesday. The two-year Treasury yield was flat at 3.57%.
U.S. crude oil futures jumped 4.8% to $71.92 a barrel last week.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF bounced 3.7% last week. The iShares Expanded Tech-Software Sector ETF rose 2.1%. The VanEck Vectors Semiconductor ETF edged up 0.4%. Nvidia stock is the largest SMH holding by far.
Reflecting stocks with more speculative stories, the ARK Innovation ETF gained 2.45% last week and ARK Genomics climbed 0.5%. Tesla stock is a major holding across ARK Invest's ETFs, but Meta is an even bigger weight. Cathie Wood also has built up a big stake in NVDA stock.
The SPDR S&P Metals & Mining ETF ran up 2.9% last week. The U.S. Global Jets ETF ascended 2.6%. The SPDR S&P Homebuilders ETF stepped up 2.3%. The Energy Select SPDR ETF rallied 3.7%, but the Health Care Select Sector SPDR Fund fell 0.5%. The Industrial Select Sector SPDR Fund was up 2%.
The Financial Select SPDR ETF moved 2.4% higher and the SPDR S&P Regional Banking ETF jumped 3.35%.
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Nvidia Stock
Nvidia stock fell 2.6% to 116 for the week, closing just below its 50-day moving average. The weekly decline did follow the prior week's 15.8% surge.
NVDA stock has a 131.26 buy point from an unsightly handle. Investors also could use last week's high of 120.79 as a much smaller handle.
After leading the market since early 2023, Nvidia has struggled somewhat over the past three months.
Ideally, Nvidia would keep pace with the market rally, or at least hold above key levels. If it can't, that could raise questions about chips and AI hardware plays, including Taiwan Semiconductor.
Meta Stock
Meta Platforms stock jumped 7% for the week to 561.35, Shares ran past a 542.81 buy point and a 544.23 alternate entry from a three-weeks-tight pattern.
Shares rose slightly early Monday, moving toward the top of the buy zone.
Tesla Stock
Tesla stock rose 3.5% to 238.25 for the week, clearing an aggressive entry of 235. Shares jumped 7.4% on Thursday, pulling back modestly on Friday. TSLA stock has a 271 cup-base buy point, according to MarketSurge. Investors might wait to see if the EV giant can forge a proper handle.
Tesla stock rose slightly before the open.
Tesla has a busy October, with third-quarter deliveries likely on Oct. 2, the robotaxi event on Oct. 10, and Q3 earnings on Oct. 16. Also, already fierce China EV competition will ramp up significantly next month.
Apple Stock
Apple stock advanced 2.6% to 228.20, gapping above its 50-day moving average and clearing a trendline entry. Apple stock has a handle buy point of 232.92. The Dow Jones tech titan rallied on positive comments about the iPhone 16, following concerns of underwhelming demand. The latest handsets, which began official sales Friday, will have AI features later this year.
Shares edged lower early Monday.
Other Stocks In Buy Zones
Spotify jumped 8.1% to 365.17, clearing a 359.38 buy point, though 350.32 served as an early entry.
Royal Caribbean stock climbed 3.6% to 174.05, above a 169.47 cup-with-handle buy point.
Evercore stock leapt 7.4% to 256.57, clearing a 254.74 consolidation buy point. The M&A advisory firm offered early entries during the week.
What To Do Now
The S&P 500 and Dow Jones are at highs while the Nasdaq is reviving. A slew of stocks have flashed buy signals with many continuing to march higher.
The Fed has started to cut rates while the economy seems to be growing at a modest pace.
The news cycle is relatively light until earnings ramp up in mid-October. In the coming week, Micron Technology, KB Home and Costco Wholesale report. On Friday, investors will get the core PCE price index, the Fed's favorite inflation gauge.
So this is a good time to be heavily invested and perhaps focus on aggressive holdings. If you're still modestly invested, there are still opportunities to add exposure, but do so gradually.
So keep working on those watchlists.
But always have an eye to exit. If the Nasdaq falls back toward the 50-day line and growth falters, perhaps dragged down by Nvidia, listen to the market.
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