Dow Jones futures rose slightly early Friday after the March jobs report showed slowing hiring and wage growth and slowing unemployment. Meanwhile, Tesla (D.S.L.A) is lowering the US prices of all its electric vehicles. US markets are closed today.
Major indexes were good during the holiday-shortened trading week, with midweek bullbacks healthy and normal. But many sectors and leading stocks, including Tesla shares, sold off sharply
Google Parents letters (Google) erupted on Thursday. China’s e-commerce giant Ali Baba (Baba) flashed an aggressive entry.
Google stock is among IBD’s long-term leaders Microsoft (MSFT)
Video embeddedIn the article Weekly Market Action and Google, Baba Stock and Analysis Intuitive surgery (ISRG)
Statement of Works
The Labor Department said nonfarm payrolls rose by 236,000, below estimates of 240,000. This was down from February’s revised 326,000.
Private payrolls rose by just 189,000. Just under 223,000 views. Manufacturing jobs unexpectedly fell by 1,000.
The unemployment rate unexpectedly fell to 3.5%, returning to a long-term low. However, the labor force participation rate rose to 62.6%.
Hourly earnings rose 0.3% versus February. The annual gain was 4.2%, below the 4.3% outlook and the lowest in years. Three-month annualized wage growth fell to 3.2%.
The average work week was unexpectedly reduced to 34.4 hours.
Despite slower wage gains and private hiring, the odds of a Fed rate hike in May rose from 49% on Wednesday morning to 69% on Thursday morning.
Dow Jones Futures Today
Dow Jones futures rose 0.2% versus fair value, rebounding from slim losses ahead of the jobs report. S&P 500 futures advanced 0.2%. Nasdaq 100 futures rose 0.1%.
The 10-year Treasury yield rose 8 basis points to 3.37%.
Stock futures trading halted at 9:15 a.m. ET.
US stock markets are closed for Good Friday.
Hong Kong and European markets are closed for Good Friday and Easter Monday.
Remember that overnight action in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
Join IBD experts as they examine stocks that could be in for a stock market rally on IBD Live
Stock market rally
Stock market bulls had a mixed week. The Dow Jones Industrial Average rose 0.6% in weekly stock market trading. The S&P 500 index fell 0.1%. The Nasdaq fell 1.1% and the Russell 2000 fell 2.5%.
U.S. crude oil prices rose 6.65% to $80.92 a barrel, largely after Monday’s surprise OPEC+ production cut. Crude futures rose 20.9% in three weeks.
The 10-year Treasury yield fell 22 basis points to 3.28%, a seven-month low.
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Among growth ETFs, the innovator IBD 50 ETF (FFTY) fell 3.5% on the week. iShares Expanded Technology-Software Sector ETF (IGVfell 1.6%. A Microsoft stake is a major IGV holding. VanEck Vectors Semiconductor ETF (SMHIt gave up to 4.1%.
Reflecting the more speculative story stocks, the ARK Innovation ETF (ARKKslipped 4.4% and the ARK Genomics ETF (ARKG) both fell 1.2% despite Thursday’s gains. Tesla shares are the No. 1 holding across Arc Invest’s ETFs.
Tesla price cut
Tesla slashed the US prices of all its EVs overnight. It’s the third time this year that Model S and X prices have dropped by $5,000. Model S starts at $84,990, Model X now starts at $94,990.
Meanwhile, Tesla dropped the US Model 3 price by $1,000 to an entry price of $41,990. The Model Y has been reduced by $2,000 to $49,990.
Earlier in the week, Tesla dropped the prices of the Model 3 and Y once again in Australia.
Tesla cut global prices in January with US cuts on its S and X vehicles and additional European discounts in March. That, along with new US EV arrivals, pushed first-quarter Tesla deliveries to a new record. But they were less than factset scenarios. Production once again outstripped deliveries, with Model S and X output more than double sales.
Many analysts predicted Tesla price cuts, supporting demand and further reducing its valuable margins.
Investors won’t have a chance to react to the latest Tesla price cut until Monday. But Tesla shares fell 10.8% this week to 185.06 following the Q1 delivery report. Shares fell below the 200.76 cup-with-handle buy point and the 50-day moving average.
A base formed below the 200-day line, which is not significant. The 200.76 buy point is no longer valid, but TSLA stock is working on a new handle, already with a 207.89 entry on the weekly chart. Of course, the 200-day line is still above that.
Tesla earnings for the first quarter are due on April 19, when investors will see how the price cuts have hit profit margins so far.
Google rose 3.8% on Thursday to trade above normal at 108.42. Shares crossed a cup-with-handle buy point of 106.69, according to MarketSmith analysis.
Google’s CEO said the company will soon add chat AI to its search engine Microsoft (MSFT) added ChatGPT to its Bing search engine and other products.
Alibaba shares rose 4.25% to 102.74 on Thursday, breaking a bearish decline and giving an early entry. The new handle is above the 50-day line, but the base is lower.
BABA shares rose in the week before Alibaba said it would split into six different units with their own CEOs and the option to file for IPOs.
Stock market rally analysis
The stock market rally had a normal and healthy bounce in the major indices during the week.
The Nasdaq fell, but the Jupiter recovered the 12,000 level. The Dow Jones rose while the S&P 500 fell.
Google stock had a solid week and Meta platforms (Meta) was rising. Apple (AAPL) and Microsoft shares were little changed on the edge of buy areas. Meanwhile, Exxon Mobil (XOM), Merck (MRK) and United Health (UNH) had large weekly gains.
But there were several major failures. Construction and industrials-related groups fell on Tuesday, while growth stocks sold off on Wednesday. Many suffered significant damage, while others may return to normal relatively quickly. Jupiter’s regeneration, often from key positions, is certainly encouraging.
Defensive growth and defensive names had a strong week, including medical, consumer staples and utilities.
Will those areas continue to outperform if the “risk-on” mentality returns?
Read the big picture every day to stay in tune with market direction and leading stocks and sectors.
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