Dow Jones futures, along with S&P 500 and Nasdaq futures, dipped overnight as Adobe (ADBE) reported earnings late Thursday. The stock market rally took a hit due to a hot inflation report that sent Treasury yields soaring. Major indexes saw modest losses, primarily driven by Microsoft (MSFT), Apple (AAPL), Google parent Alphabet (GOOGL), and Amazon.com (AMZN). Notable losers included Nvidia (NVDA) and Tesla (TSLA), although their charts displayed different patterns.
Market breadth was weak overall, with small caps taking a beating. Microsoft and Google stocks flashed buy signals on Thursday, while Arista Networks (ANET), Ares Management (ARES), and HubSpot (HUBS) were on the verge of forming new bases. Adobe and Ulta Beauty (ULTA) also reported earnings on Thursday night.
Nvidia stock is part of the IBD Leaderboard, while Microsoft stock is listed on the IBD Long-Term Leaders list. Additionally, GigaCloud stock, Nvidia, Arista Networks, HubSpot, and Ares are included in the IBD 50. Nvidia and Arista stock are part of the IBD Big Cap 20, with Ares being Thursday’s IBD Stock Of The Day.
In Thursday’s market action, Dow Jones futures fell 0.1%, S&P 500 futures lost a fraction, and Nasdaq 100 futures sank 0.2%. The 10-year Treasury yield rose to 4.29%. Adobe’s earnings slightly exceeded expectations, but the stock sold off overnight despite a $25 billion buyback announcement. Ulta Beauty’s earnings beat views, but the stock fell in extended trade.
The stock market rally faced pressure on Thursday due to a stronger-than-expected producer price index, causing Treasury yields to rise. The Dow Jones Industrial Average, S&P 500, and Nasdaq composite all saw declines. Microsoft, Apple, Amazon, and Google were among the megacaps that pushed higher, while small caps and market breadth struggled.
U.S. crude oil prices climbed to $81.26 a barrel, and the 10-year Treasury yield surged to 4.3%. Growth ETFs, including the iShares Expanded Tech-Software Sector ETF (IGV) and VanEck Vectors Semiconductor ETF (SMH), experienced declines. Tesla and Nvidia stocks faced losses, with Tesla hitting a 10-month low.
As the stock market rally pauses, investors are advised to watch for potential buying opportunities as some stocks near key buy points. Microsoft, Google, Arista, Ares, and HubSpot are showing signs of possible upward movements. Tesla’s decline and Nvidia’s stability signal potential shifts in the chip sector.