Dow Jones futures fell modestly Monday morning, along with S&P 500 futures and Nasdaq futures. The Tesla robotaxi event and Taiwan Semiconductor figures headline the coming week.
The stock market rally shrugged off Mideast fears, with the major indexes erasing losses to end the week slightly higher with a strong Friday finish.
Tesla holds its long-awaited robotaxi event Thursday night. But what Elon Musk will reveal is still a mystery.
Nvidia chipmaker Taiwan Semiconductor reports third-quarter sales early Wednesday. Delta Air Lines will report early Thursday and JPMorgan Chase Friday morning, kicking off results for those sectors.
The September consumer price index is due Thursday and the producer price index a day later.
Taiwan Semiconductor stock is in a buy zone, while Nvidia, Delta and Tesla stock are all near buy points. JPMorgan stock is close to an early entry, with a traditional buy point in sight as well.
But buying opportunities aren't as plentiful right now, with some early leaders offering riskier entries.
Nvidia stock is on IBD Leaderboard, SwingTrader and the IBD 50.
Dow Jones Futures Today
Dow Jones futures were 0.4% below fair value. S&P 500 futures declined 0.5% and Nasdaq 100 futures fell 0.5%.
The 10-year Treasury yield hit 4%. That's the first move to 4% in months.
Crude oil futures jumped nearly 2%.
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 pulled back Tuesday on Iran's missile attack on Israel, but the major indexes found support and ended the week little changed.
The Dow Jones Industrial Average rose 0.1% in last week's stock market trading, hitting a record close. The S&P 500 index advanced 0.2%, just below all-time levels. The Nasdaq composite climbed 0.1% after holding its 21-day line, moving back above 18,000 on Friday. The small-cap Russell 2000 fell 0.5%, but bounced off the 50-day line and reclaimed its 21-day line by Friday.
All four indexes have three-weeks-tight patterns and were at least flirting with breaking short-term downtrends on Friday.
The 10-year Treasury yield spiked 23 basis points to 3.98%, the biggest weekly gain in nearly a year. The two-year yield, more closely tied to Fed policy, skyrocketed 37 basis points, the most in two years, to 3.93%. With the economy looking solid, Fed rate cuts may be gradual. The upcoming CPI and PPI inflation reports may not alter that dynamic.
U.S. crude oil futures surged 9.1% to $74.38 a barrel, the biggest weekly gain since March 2023.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF gained 1.3% last week. The iShares Expanded Tech-Software Sector ETF advanced 0.7%. The VanEck Vectors Semiconductor ETF rose a fraction. Nvidia is the top holding in SMH, with Taiwan Semiconductor stock also a key member.
ARK Innovation ETF fell 2.8% last week. Tesla stock is still a big holding across Ark Invest's ETFs. Cathie Wood also has built up a sizable Nvidia stock stake.
SPDR S&P Metals & Mining ETF fell 0.7% last week. U.S. Global Jets ETF declined 0.6%, with Delta stock a key holding. SPDR S&P Homebuilders ETF retreated 2.4%.
The Energy Select SPDR ETF jumped 6.9% and the Industrial Select Sector SPDR Fund added 0.5%. The Financial Select SPDR ETF rose 1.15%, with JPMorgan stock a major component.
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Tesla Robotaxi Event
The Tesla robotaxi event will take place Thursday night, with many unknowns.
Presumably, Tesla will show off a working robotaxi and drive it on the Warner Bros movie studio lot. CEO Elon Musk will likely be bullish about Tesla achieving true self-driving soon, but he's said that for years.
The Optimus robot may make an appearance. Tesla may finally show off the "affordable" electric vehicle that's slated to come next year.
Tesla Stock Gets A Handle
Tesla stock fell 4% last week to 250.08, after Tesla deliveries were in line for Q3, but below some whisper numbers. Shares found support around the 21-day moving average, rising 3.9% on Friday. Tesla stock now has a handle on a weekly chart, giving it a 264.86 cup-with-handle buy point. That handle will be valid on a daily chart after Monday's close.
But investors should be cautious about buying Tesla stock before the robotaxi event, unless using an earnings options-type strategy.
Tesla is clearly looking to ramp up sales in the fourth quarter by offering new de facto price cuts. It's now opening up non-Foundation Series Cybertrucks to order. The dual-motor Cybertruck is now available for $79,990, down from $100,000 for the Foundation Series variant.
Late in the week, Tesla began offering $2,500 discounts in the U.S. on many Model 3 and Model Y inventory vehicles.
Taiwan Semiconductor In Buy Zone
Taiwan Semiconductor reports sales early Wednesday. The world's largest contract chipmaker makes chips for Nvidia, Broadcom, Apple and many more. It's also one of the biggest buyers of chip equipment. So Taiwan Semi's sales, and earnings the following week, will have a big impact on the chip sector.
TSM stock rose 1.8% for the week. Shares fell below a 175.45 cup-with-handle entry early in the week but reclaimed the buy point later, according to MarketSurge analysis.
Nvidia Stock Rebounds
Nvidia stock climbed 2.9% to 124.92 for the week, rebounding strongly from the 50-day line on Wednesday. Investors could use the Sept. 26 high of 127.67 as a trendline entry or handle buy point. The Aug. 26 high of 131.26 also could serve as an NVDA stock buy point.
Nvidia CEO Jensen Huang said late Wednesday that Blackwell, the next-generation AI chip, is in "full production" with demand "insane."
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Delta, JPMorgan Earnings
Delta Air Lines earnings are expected to fall, but there's optimism about the travel sector. Delta and other airline stocks rallied strongly from early August, in part due to the prospect of lower fuel costs. Shares sank last week as oil prices soared. Delta stock has a 52.45 cup-with-handle buy point.
JPMorgan earnings also are seen sliding, amid concerns about net interest income and more. JPMorgan stock has a new flat base with a 225.48 buy point, just reclaiming the 50-day line on Friday. A decisive move from the 50-day could offer an early entry, but would be highly risky before earnings.
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What To Do Now
The stock market rally has been consolidating over the last week, holding key levels despite some negative headlines. The economic backdrop is close to perfect: Modest-to-solid growth with the Fed cutting rates.
Investors should have heavy exposure, with sizeable buys in September.
Adding now is little trickier. Some stocks broke out or flashed early buy points last week, but many of the early leaders are well extended from bases.
Investors can look for pullbacks to short-term levels, such as the 21-day line. Palantir Technologies, ServiceNow and Samsara all made strong moves off the 21-day last week. Those were legitimate add-on buying opportunities, but higher risk for new positions.
The market rally is in a power trend, a time for being more aggressive. Investors have to weigh their risk tolerance and their ability to be nimble in making buy ands cutting losses.
Keep working on watchlists, looking for traditional buy points, early entries and pullbacks.
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