Χ The main indexes fell moderately on Wednesday amid a strong rally on the stock market since March 14. Crude futures and other commodity prices rebounded as bond yields fell. Banks were big losers as bond yields fell on the yield curve near the reversal. Chips and software also declined, though often after several days of gains. Shares of Apple, Tesla (TSLA), Microsoft (MSFT) and Google parent company Alpha (GOOGL) have just moved. Apple (AAPL) is in the market range, although a pause in the market would be helpful. The share of Microsoft and Google is above the first registrations, while the share of Tesla is approaching the buying points. Meanwhile, energy, fertilizer and other commodity games recovered on Wednesday after retreating on Tuesday. Many are expanding. However, the big oil company Shell (SHEL) is just below a buy point, while the quasi-lagging Philips 66 (PSX) is hovering around a potential entry.
Release of Strategic Reserves
US crude fell 6%. President Biden’s team is considering a plan to release about a million barrels a day from strategic reserves for several months to combat high gas prices and supply problems amid Russia’s invasion of Ukraine. This according to many reports on Wednesday night. An announcement could come on Thursday as Biden talks about ways to reduce energy prices. Biden’s acceptance rating has dropped to a 40-year high with inflation. Polls suggest Republicans will regain control of Congress in November. OPEC + will meet today to discuss crude oil prices and supply. OPEC + includes Russia.
Inflation data
At 8:30 a.m. ET on Thursday, the Commerce Department will release new inflation data as part of its February revenue and expenditure report. The personal consumption expenditure index, the Fed’s favorite inflation index, is expected to rise 6.4% year-on-year. Core PCE inflation appears to be approaching 5%. On Friday, the Ministry of Labor will publish the report on the March jobs. The next Fed policy meeting is not before 3-4 May, so there will be some inflation measurements by then. However, the report on inflation and jobs will signal whether policymakers will raise interest rates by 50 basis points in early May and future meetings, against quarterly moves. Shares of Tesla and Microsoft are on the IBD Leaderboard. Shares of Microsoft and Google are listed on IBD Long-Term Leaders. Tesla shares, Google and Microsoft are at IBD 50.
Dow Jones Futures Today
Dow Jones Futures were 0.1% below fair value. S&P 500 futures traded lower. Nasdaq 100 futures rose 0.2%. The yield on the 10-year bond decreased by 4 basis points to 2.32%. Thursday’s inflation report is likely to affect the performance of futures and Dow government yields. Remember that overnight action on Dow futures and elsewhere does not necessarily translate into real trading at the next regular trading session. Join the IBD experts as they analyze stocks that can act in the stock market rally at IBD Live
Stock Market Rally
The stock market rally had a downward session, led by technicians and small capitalization. The Dow Jones Industrial Average fell 0.2% on Wednesday. The S&P 500 index sank 0.6%, with the PSX share being among the top performers. The Nasdaq composite fell 1.2%. Russell 2000 small capitalization fell 1.9%. Crude oil prices fell 3.4% to $ 107.82 a barrel, albeit from a high in the morning. Gold and base metals also advanced. The yield on the 10-year bond decreased by 4 basis points to 2.36%. The 2-year yield decreased by 4 basis points to 2.31%, with the spread being only at 5 basis points. The yield curve is approaching the reversal and actually happened for a while on Tuesday. An inverted yield curve is bad news for traditional lenders, with regional banks losing big on Wednesday. It is also a possible signal of a recession, although the general upward trend in interest rates suggests otherwise. Also, an inverted yield curve usually does not signal a recession or stock market correction for several months.
ETF
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) sank 1.4%, while the Innovator IBD Breakout Opportunities ETF (BOUT) fell 0.4%. The iShares Expanded Tech-Software Sector ETF (IGV) fell 1.9%, with the MSFT stock being a significant IGV component. VanEck Vectors Semiconductor ETF (SMH) sank 2.9%. The SPDR S&P Metals & Mining ETF (XME) rose 1.1% and the Global X US Infrastructure Development ETF (PAVE) fell 0.9%. The US Global Jets ETF (JETS) fell 0.3%. The SPDR S&P Homebuilders ETF (XHB) fell 3.6% as the RH (RH) drove some home retailers sharply lower. The Energy Select SPDR ETF (XLE) climbed 1.2% and the Financial Select SPDR ETF (XLF) fell 0.7%, although regional banks were hit much harder. The Health Care Select Sector SPDR Fund (XLV) rose 0.2%. Reflecting the most speculative stocks, the ARK Innovation ETF (ARKK) fell 3.8% and the ARK Genomics ETF (ARKG) fell 3.6%. Both were held above the 50-day moving average. Tesla’s stock remains the No. 1 stake in Ark Invest’s ETFs. Five best Chinese stocks to watch now
Shell Stock
Shell shares rose 4% to 55.61 points, recovering from the 50-day moving average. Investors could buy SHEL shares now or expect to break away from the official 56.23 flat point. The flat base is part of a base-base formation. The relative strength line for the SHEL stock remains near high after a strong rise in late 2021.
Phillips 66 Stock
PSX shares rose 4.8% to 87.44 points, recovering the 50-day moving average as refineries and other energy games recovered along with crude oil prices. The Phillips 66 has an official market price of 94.44 in a consolidation that starts last June. Investors could use the 93.64, just above the February short-term high, as an early entry. However, the aggressive traders could have used Wednesday’s move as a place to start a position, both from the 50-day line and to break a short-term trend line.
Apple Stock
Apple shares fell 0.7% to 177.77 points, ending a 11-day winning streak. On Tuesday, shares rose 1.9% to 178.96 points, surpassing the buy point at 176.75 with a double base. Investors could still buy AAPL shares or wait for a pause or manipulation. The RS line is again at record highs, reflecting Apple’s share performance against the S&P 500. The RS line is the blue line in the charts provided.
Google Stock
Google shares fell 0.4% to 2,838.77 points, continuing to trade closely in the last many sessions. The GOOGL stock is active from the 200 day line as an early entry or as a long term leader. A grip around the current levels would also be positive. The official market point at the moment is 3.0313.03. The RS line is just below the highs, but has been moving sideways since early September.
Microsoft stock
Microsoft shares fell 0.5% to 313.86 points after recovering from the 200-day line in the previous two sessions. Investors could buy MSFT shares as an early entry or long-term leader here, or after overcoming Wednesday’s daily high. The official buying point is 349.77.
Tesla stock
Tesla shares fell 0.5% to 1,093.99, but after rising in 10 of the previous 11 sessions. The EV giant is fighting for a 1208.10 cup-based market point and an early entry of around 1,150. Ideally, the Tesla stock would be a handle, creating a lower-priced, lower-risk market. And this grip must be felt. A barely perceptible grip on a daily chart will probably not drive many weak holders out of a fast-charging TSLA stock. Tesla Shanghai, which closed on Monday as the city faces a Covid shutdown, will reportedly not resume production on Friday or Saturday. Tesla Vs. BYD: Which Booming EV Giant is best to buy?
Market Rally Analysis
To paraphrase the Rolling Stones, you can not always get what you want, but sometimes you get what you need. The stock market rally can not go up every day, with the key indicators falling on Wednesday. But that’s part of a rapid rise in recent weeks. The Nasdaq’s impact resistance close to the 200-day moving average is natural. Small losses in shares of Apple, Microsoft, Google and Tesla helped mask the decline in key indices, along with gains in commodity markets. But even so, the indices and the top stocks do not look damaged. Undoubtedly, the market rally could use several days to stop or recede. This would help, among other things, the shares of Apple and Tesla to create manipulations. But the market will do what it’s going to do. Market time with IBD ETF market strategy
What should we do now
The stock market rally cannot go up every day. Therefore, investors should remain bullish, but flattened. Is this a long-awaited market break and will it last more than a day or two? Do not try to anticipate, just be prepared to respond to market actions. The movements between commodity stocks and growth stocks during the last two sessions show the positive elements of the existence of a portfolio of diversified leaders. It is also a reason why investors should gradually boost their exposure to avoid making big new bets on short-term peaks. Keep working on an extensive watch list by closely monitoring a select group of stocks in or near market zones. Read the Big Picture every day to stay in sync with market direction and top stocks and industries. Follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more. YOU CAN ALSO LIKE: Catch the next big payout with MarketSmith Do you want to make quick profits and avoid big losses? Try SwingTrader The best growth stocks for buying and monitoring IBD Digital: Unlock IBD Premium stock lists, tools and analysis today
