Dow Jones Futures Lead Fed Minutes; Tesla shares rise higher on upgrade

Dow Jones futures rose modestly on Wednesday ahead of the minutes of the Federal Reserve’s latest policy meeting. Tesla shares rose higher after Citigroup upgraded the EV giant.


Before the Fed’s minutes are released at 2 p.m. ET, consumer confidence, durable goods orders, first jobless claims, purchasing managers’ index readings and new home sales are all scheduled for the morning. The market is closed on Thursday for Thanksgiving, followed by a shortened trading session on Friday.

Initial jobless claims, released at 8:30 a.m. ET, rose to 240,000 versus 222,000 in the previous week. Meanwhile, durable goods rose 1% in October, beating the Econoday estimate of 0.4%.

Auto desk (ADSK), PK (HPQ) and Nordstrom (JWN) reported the results late Tuesday, while Deere (DE) results came out Wednesday morning.

Autodesk shares were down 10%, while HPQ shares were up about 2% in early morning trading. Nordstrom shares plummeted 8.6%. And Deere shares were up 4% in premarket trading.

Giant of electric vehicles Tesla (TSLA) was trading nearly 3% higher Wednesday morning. Dow Jones Technology Leaders Apple (AAPL) and Microsoft (MSFT) were mixed ahead of today’s stock market open.

IBD Leaderboard stock Arista Networks (A NET), KL (KLAC), Shoals Technologies (SHLS) and Ultimate beauty (ULTA) — as well as the name Dow Jones Caterpillar (CAT) — are among the top stocks to buy and watch.

Arista Networks is an IBD Leaderboard stock and was a recent IBD stock of the day. Ulta Beauty was featured in this week’s Stocks column near a buy zone. Shoals was Thursday’s IBD 50 Stocks To Watch pick.

IBD’s latest newsletter MarketDiem gives you actionable ideas for stocks, options and cryptocurrencies straight to your inbox.

Dow Jones Today: Oil Prices, Treasury Yields

Prior to Wednesday’s opening bell, Dow Jones futures were down 0.15% from fair value, while S&P 500 futures were down 0.1%. Tech-heavy Nasdaq 100 futures traded 0.1% higher during the morning action.

China-related stocks showed strength early on, after news reports reported that the State Council had announced stimulus measures, including a reduction in reserve requirements for Chinese banks.

Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) rose 0.15% early Wednesday and the SPDR S&P 500 ETF (SPY) rose 0.1%.

The yield on 10-year Treasury bills ticked higher on Wednesday morning to 3.77%.

Oil stocks were under some pressure as oil prices eased after a recovery on Tuesday. West Texas Intermediate futures fell more than 3% to under $79 a barrel even after industry data showed US crude inventories fell more than expected last week.

Natural gas stocks were boosted as gas prices continued to rise. US natural gas futures rose nearly 7% after Russia issued a warning after Russia accused Ukraine of stealing gas from a pipeline and threatened to curtail supplies on Russia’s last remaining supply line to Europe.

Stock market rally

On Tuesday, the stock market posted solid gains. The S&P 500 and the Nasdaq composite each rose 1.4%. The Dow Jones Industrial Average climbed 1.2%.

Tuesday’s Big Picture noted, “While it’s fine to put money to work in today’s stock market, keep your exposure on the conservative side with small positions to begin with. Just because the stock market is in a confirmed uptrend, doesn’t mean you have to be 100% invested. And don’t be afraid to take a 10% profit if you have it, given the choppy nature of the market.”

This is an important time to read IBD’s The Big Picture column amid the continued volatility in the stock market.

Five Dow Jones stocks to buy and watch now

Dow Jones Stocks to Buy and Watch: Caterpillar

Dow Jones member Caterpillar is poised to regain its cup base’s 238 buy points, according to IBD MarketSmith pattern recognition, and is less than 1% below the entry. CAT gained 0.7% on Wednesday and traded higher along with Deere. Stocks are poised to regain entry to the open market if morning strength continues.

CAT stocks have an impressive 95 out of a perfect 99 IBD Composite Rating, according to the IBD Stock Checkup.

4 Top Growth Stocks to Watch in the Current Stock Market Rally

Top stocks to buy and watch: Arista, KLA, Shoals, Ulta

IBD Leaderboard share Arista Networks moved further above the 132.97 buy point from a choppy base after Tuesday’s gain of 1.1%. ANET shares fell 0.4% on Wednesday.

KLA is approaching the buy point of 392.60 of a handle cup during Tuesday’s 2.7% increase. Bullish, the stock’s relative strength line reached a new high last week, a sign of a major outperformance against the S&P 500. KLAC shares were inactive Wednesday.

Shoals Technologies is still out of buy range at a buy point of 28.57 after a third straight drop on Tuesday. The 5% buy zone tops out at 30. Wait for an orderly pullback in the buy range before considering a stock buy. SHLS stock was unchanged Wednesday morning.

Ulta Beauty stepped out of the buy range on Tuesday and rose nearly 2%. The 5% buy zone past a buy point of 426.99 in a handle cup rises to 448.34. Ulta will report third quarter results on December 1. The stock was trading flat on Wednesday.

Join IBD experts as they analyze leading stocks in the current stock market rally on IBD Live

Tesla stock

Tesla shares climbed 1.2% on Tuesday, breaking a four-day losing streak that saw the stock reach its lowest level since November 23, 2020. The stock reached a new 52-week low of 167.54 on Monday. Tesla shares are about 57% off their 52-week high and sharply below their 50- and 200-day moving averages.

Shares of the EV giant were up 2.6% Wednesday morning after Citigroup upgraded the stock from selling to neutral, raising its price target from 141.33 to 176.

Dow Jones leaders: Apple, Microsoft

Among Dow Jones stocks, Apple shares rallied 1.5% on Tuesday and are still holding above their recently recaptured 50-day line. The stock is about 20% lower than its 52-week high. The stock fell 0.3% on Wednesday, as Foxconn employees clashed with police officers. Foxconn is the largest iPhone assembly plant in China.

Microsoft rose 1.2% on Tuesday, adding to Monday’s gains. Stocks remain above the 50-day mark. The software giant remains more than 30% away from its 52-week high. Microsoft shares rose 0.2% on Wednesday morning.

Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more information on growth stocks and the Dow Jones Industrial Average.


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