Dow Jones Futures: Stock Market Sliding Toward Fed; Amazon Rises Lately as AMD, Super Micro Plunge

Dow Jones futures lost a fraction after hours, while S&P 500 futures and Nasdaq futures fell modestly. Amazon.com (AMZN), Super microcomputer (SMCI) And Advanced micro devices (AMD) topped key earnings headlines as the Fed meeting announcement takes place on Wednesday afternoon.

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The attempted stock market rally retreated sharply as a high employment cost index raised new inflation concerns. Major indices are seeing resistance ahead of the Fed meeting and big earnings and economic data.

Eli Lilly (LLY) jumped on the win on Tuesday, briefly flirting with an early entry. Tesla (TSLA) retreated after new layoffs, but is still up sharply over the past week.

After the close, Amazon rose slightly on earnings despite weak expectations. AI plays Super Micro and AMD shares sold in volatile action. Super Micro and AMD results and guidance are critical for AI chipmakers like Nvidia (NVDA).

TransMedics (TMDX), Powell Industries (POWL) And Pinterest (PIN) also reported too late. TransMedics shares rose sharply on the earnings, pushing them off their base. PINS stock soared, jumping above the 50-day line and a trend line, near the top of a new base. Powell Industries, another AI-adjacent play, broke above the 50-day mark in terms of blowout results.

Nvidia and Eli Lilly stock are up IBD rankings. Nvidia shares are listed on SwingTrader. Nvidia and TransMedics stock are on the line IBD50. Nvidia and SMCI stocks are on the list IBD Bigcap 20. Eli Lilly was the IBD stock of the day on Tuesday.

The video embedded in the article discussed Tuesday’s market action and discussed Eli Lilly, Modine production (MOD) And Constellation Energy (CEG).

Dow Jones futures today

Dow Jones futures fell lower versus fair value. Futures on the S&P 500 fell 0.2%. Nasdaq 100 futures lost 0.4%.

Remember, overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading during the next regular stock market session.

Fed Meeting, Economic Data

The Federal Reserve concludes its two-day meeting on Wednesday, with its policy statement at 2 p.m. ET. Fed chief Jerome Powell will speak at 2:30 p.m. Expect Powell and the Fed to indicate there is no rush to cut rates, perhaps even until next year.

Wednesday will be full of economic data. The April ADP Employment Report is released at 8:30 a.m. ET. At 10am, the April ISM Manufacturing Index will be available, as will the March JOLTS report and construction spending.

The April jobs report looms on Friday.

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Stock market rally

The stock market rally saw caution reflected in the overnight earnings results and in the run-up to the Fed meeting announcement, with a sharp sell-off until the close.

The Dow Jones Industrial Average fell 1.5% in stock trading on Tuesday. The S&P 500 index fell 1.6% and the Nasdaq fell 2%, falling from near their 50-day limit and undermining their 21-day limit. The small-cap Russell 2000 fell 2.1%, also falling below the 21-day index.

Friday had many elements of a Nasdaq follow-up day, but technically didn’t qualify. In any case, FTDs are not infallible.

The S&P 500 and Nasdaq must rise above the 50-day limit. This can happen at any time, or over several weeks or months.

It was a risk session. US crude oil prices fell 0.85% to $81.93 per barrel. Copper futures fell 2%. Bitcoin fell 6% to $59,165.57, a two-month low.

The yield on ten-year government bonds rose by 7 basis points to 4.68%. The yield on two-year government bonds, which is more closely tied to the Fed’s interest rate outlook, is back above 5%.

ETFs

Of the growth ETFs, the iShares Expanded Tech-Software Sector ETF (IGV) retreated 2.5%. The VanEck Vectors Semiconductor ETF (SMH) fell 2%, with AMD stock taking a notable position. Nvidia is the largest SMH component, of which AVGO stock is also a member.

ARK Innovation ETF (ARKK) plummeted 3.7%, with Tesla stock taking the No. 1 position.

The SPDR S&P Metals & Mining ETF (XME) slipped 3.45%. The SPDR S&P Homebuilders ETF (XHB) has stepped down by 1.8%. The Energy Select SPDR ETF (XLE) lost 3%.

The Healthcare Select Sector SPDR fund (XLV) fell by 0.1%. Eli Lilly stock is a key XLV component. The Industrial Select Sector SPDR fund (XLI) fell 1.6% The Financial Select SPDR ETF (XLF) fell by 1%.

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Amazon revenue

Amazon’s revenues and sales exceeded first-quarter results. Amazon Web Services revenue rose 17% on AI-led gains. But second-quarter sales guidance was light.

Shares of Amazon rose modestly in overnight trading. Shares fell 3.3% to 175 during Tuesday’s regular session, falling below the 50-day line.

Super micro income

Super Micro’s earnings easily exceeded third-quarter expectations, while revenue lagged slightly. But the AI ​​server maker led well above consensus for the current quarter.

SMCI shares fell more than 10% in volatile overnight trading, back to recent lows. Super Micro shares fell 3.5% to 858.80 on Tuesday. Shares are trying to recover after a 23% plunge on April 19, as the AI ​​server maker didn’t provide preliminary guidance when announcing its earnings date. That also caused big losses for AI chip players such as Nvidia and Broadcom.

AMD revenue

AMD’s revenue and sales just surpassed views, while revenue guidance was roughly in line.

AMD shares plummeted amid extended action. Shares fell 1.1% to 158.38 on Tuesday, some distance from the 50-day mark.

Nvidia shares fell modestly after hours after holding their 50-day line on Tuesday.

Eli Lilly Stock

Shares of Eli Lilly rose nearly 6% to 781.10 on Tuesday, recovering above the 50-day high to reach 795.50 intraday. On Tuesday morning, Eli Lilly’s earnings beat expectations on strong sales of its weight-loss drug Zepbound. The drug giant has raised expectations for the full year.

LLY stock has a buy point of 800.78 from a flat base. Investors could use 793.67 as an early entry.

Tesla shares

Tesla shares fell 5.55% to 183.28 on Tuesday. That’s after rising 15.3% on Monday and 34% in the four sessions following the April 23 earnings report. Investors were happy that Tesla had cleared major hurdles to the introduction of fully self-driving vehicles in China, while Elon Musk talked about ‘affordable’ electric cars, robotaxis and more.

Musk on Tuesday reportedly suspended heads of Tesla’s Supercharger efforts and new vehicle program. That follows layoffs of more than 10% last week, with two key executives leaving.

Wednesday win

Neurocrine biosciences (NBIX), Generac Holdings (GNRC) And Carpenter technology (CRS) report before Wednesday open, along with Wing stop (WING), All states (ALL), MasterCard (MA) and more.

Investors will start getting deliveries from Chinese EV manufacturers in April Li Auto (LI), Nio (NIO) And XPeng (XPEV). EV and battery giant BYD (BYDDF) reports April sales on Wednesday or Thursday.

What to do now

The attempted stock market rally is at a crucial juncture. It’s not the time to be aggressive. If you want to make purchases, make them carefully and consider smaller positions. But waiting for the market to show decisive strength amid so much news makes sense.

When the market turns higher, you want to be ready. Many shares are being built up. When the market pulls back and threatens to hit recent lows, you’ll want to scale up.

So make sure your watchlists and exit strategies are up to date.

Read The Big Picture every day to stay informed about market direction and the most important stocks and sectors.

Follow Ed Carson on Threads at @edcarson1971 and X/Twitter on @IBD_ECarson for stock market updates and more.

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