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Futures

Dow Jones Up as Nvidia Rebounds; Tesla Aims to End Losing Streak

2024-11-29

On Friday, the stock market witnessed some interesting trends. The Dow Jones Industrial Average and other major stock indexes traded higher, with Nvidia (NVDA) making a comeback and Tesla (TSLA) aiming to end a three-day losing streak. This article delves into the details of these market movements and explores the performance of key stocks.

Unraveling the Friday Stock Market Story

Stock Market Indexes on Friday

After the opening bell, the Dow Jones Industrial Average rose by 0.4%, while the S&P 500 and the tech-heavy Nasdaq composite also showed positive movements. The 10-year Treasury yield ticked lower to 4.2%, and oil prices climbed, with West Texas Intermediate futures trading around $69.20 per barrel. Among exchange traded funds, the Invesco QQQ Trust (QQQ) moved up 0.3%, and the SPDR S&P 500 ETF (SPY) added 0.2% after the open. The stock market closed early at 1 p.m. ET.In the early hours of Friday, there were various movements in different sectors. Cracks emerged in Nvidia's AI armor, raising questions for investors. Meanwhile, Tesla moved up 1.9% in morning action, looking to break its losing streak. Shares of Tesla remain sharply extended past a 264.86 cup-with-handle entry even after reversing off new highs on Monday.

Nvidia's Stock Performance

Nvidia stock bounced 1.3% on Friday, trying to rebound after a sharp pullback in the last few trading sessions. While shares declined 1.2% on Wednesday, they halted their slide at the 10-week moving average line, which is an important area to monitor. If the stock breaks this level with heavy volume, further downside could be expected. Conversely, a decisive rebound would place the AI stock in a new buy area.

Dow Jones and Other Key Stocks

On Wednesday, the Dow Jones Industrial Average fell 0.3% after hitting an all-time high. The S&P 500 and the Nasdaq composite also declined. Among the best companies to watch on the stock market today are Embraer (ERJ), Cloudflare (NET), TJX (TJX), and Tradeweb Markets (TW). Dow Jones components like Amazon.com (AMZN), Apple (AAPL), Microsoft (MSFT), and Sherwin-Williams (SHW) made notable moves. Sherwin-Williams and Cloudflare were featured in the Stocks Near A Buy Zone column. There were no new stocks on IBD MarketSurge's "Breaking Out Today" list on Wednesday, but potential breakouts can be found on the "Near Pivot" list.

Industry Group and IPOs

Dow Jones leader Sherwin-Williams is breaking out past a 392.57 buy point in a flat base, with shares up 0.7% on Friday. Outside the Dow Jones index, Cloudflare broke out last week, topping a 99.17 buy point in a cup with handle. The 5% buy zone runs up to 104.13, and shares are currently in the buy range. Embraer is in buy range above an alternative entry at 39.46 and is a recent IBD Stock Of The Day, although shares dropped 0.8% early Friday. Retailer TJX is above a 121.13 flat-base entry after strong gains and climbed 0.1% in early Friday trading. Finally, Tradeweb closed Wednesday just below a 136.13 entry in a flat base and moved up 0.4% on Friday.

Magnificent Seven Stocks

Among Magnificent Seven stocks, Alphabet (GOOGL) dropped 0.6% in morning trading and plunged below its 50-day line last week but is trying to rebound. Meta Platforms (META) is getting closer to a flat base's 602.95 buy point amid recent gains and was up 0.5% on Friday. Among Dow Jones components in the Magnificent Seven, Amazon stock rallied sharply this week and decisively retaken a 201.20 buy point, although it fell 0.2% in early trading on Friday. Shares of Apple are within striking distance of a flat base's 237.49 entry and were up 0.1% on Friday morning. Microsoft shares declined 0.8% on Friday morning but reclaimed its 50-day line during this week's gains.Be sure to follow Scott Lehtonen on X at @IBD_SLehtonen for more on growth stocks, the Dow Jones Industrial Average, and the stock market today.

US equity futures witnessed a gain on Friday as speculation about president-elect Donald Trump moderating his extreme trade policies led to the dollar's largest weekly loss in three months. This development had a significant impact on various markets.

Unraveling the Implications of Trump's Treasury Pick

Impact on US Equity Futures

The Bloomberg Dollar Spot Index extended its weekly decline, snapping eight weeks of gains. Scott Bessent's nomination last week has weakened the dollar's strength and boosted US stocks and bonds. Contracts on the S&P 500 rose 0.3%, indicating modest gains in the shortened post-holiday trading session on Wall Street. November has seen the S&P 500 rise 5%, on course for its strongest month since February. A handful of tech titans have propelled a 26% year-to-date gain, making this one of the strongest years for US stocks.Trading resumed after the Thanksgiving holiday, causing Treasury yields to fall. European stocks were relatively unchanged, but miners like Anglo American Plc outperformed due to optimism about China's measures to stimulate its economy.

Influence on Currencies

The yen rose to its highest level in more than a month against the greenback, strengthening past 150 for a while. The dollar slipped against major currencies, with an index of greenback strength heading for its first weekly decline in two months. Strong Tokyo CPI reading supported the yen's further strengthening. With a more than 60% chance of the Bank of Japan raising interest rates next month, USD/JPY is likely to sustainably break below the key 150.00 support and move lower to test the 142.00 level.In other currency markets, Brazil's real tumbled to a record low due to disappointment over a government plan to cut spending. Some investors are also adjusting their expectations for US inflation and future Federal Reserve interest rate cuts following recent data.

Effects on Commodities

Oil was steady as traders awaited further clues about OPEC+'s production plans after delaying a key virtual meeting by four days. Gold rose for a fourth session but is still on pace to drop for the first month in the past five.Key events this week include Eurozone CPI on Friday and the ECB releasing the consumer expectations survey for October. "Black Friday" marks the traditional start of the US holiday shopping rush.In stocks, the Stoxx Europe 600 was little changed as of 9:36 a.m. London time. S&P 500 futures rose 0.3%, Nasdaq 100 futures rose 0.4%, and futures on the Dow Jones Industrial Average rose 0.3%. The MSCI Asia Pacific Index rose 0.2%, while the MSCI Emerging Markets Index fell 0.1%.In currencies, the Bloomberg Dollar Spot Index fell 0.2%. The euro was little changed at $1.0562. The Japanese yen rose 0.9% to 150.18 per dollar. The offshore yuan was little changed at 7.2458 per dollar. The British pound was little changed at $1.2695.In cryptocurrencies, Bitcoin rose 1.2% to $96,297.14, and Ether was little changed at $3,571.29.In bonds, the yield on 10-year Treasuries declined four basis points to 4.22%. Germany's 10-year yield was little changed at 2.12%, and Britain's 10-year yield declined three basis points to 4.25%.This story was produced with the assistance of Bloomberg Automation.Copyright Bloomberg News.

Several fundamental and regulatory shifts have propelled the XRP price to heights not witnessed since April 2021. Bulls are now fixated on the $2 mark, indicating a resurgence of strength for this once-troubled token. In the past 24 hours alone, XRP has surged by a remarkable 14%, outpacing both bitcoin and other major cryptocurrencies. This extended month-long rally has seen the price skyrocket by 200%, making XRP the top-performing major token alongside dogecoin (DOGE). As European markets opened, prices neared $1.70, with 24-hour trading volume witnessing a significant 30% increase, reaching a staggering $10 billion. The volume surge was primarily driven by South Korean exchange UpBit.

Unraveling the Factors Behind the Jump

There was no immediate trigger for Friday's substantial jump in XRP's price. However, several factors have played a crucial role in enhancing its appeal in recent weeks. The rally began in early November following Republican victories in the U.S. elections. These victories renewed investor confidence in tokens with ties to U.S. companies, such as Ripple Labs, which is closely related to XRP. In mid-November, U.S. Securities and Exchange Commission Chair Gary Gensler's announcement of his planned departure in January further boosted hopes of a more lenient regulatory environment. This led to another surge in XRP's price. Additionally, both XRP and U.S. dollar-denominated open interest have reached record levels. With over 2 billion tokens (valued at more than $2 billion at current prices) in futures positions, traders are betting on continued market volatility. Some traders also anticipate the approval of an XRP exchange-traded fund (ETF) in the U.S., especially those who foresee a more relaxed regulatory stance. A money-market fund launched on the XRP Ledger, which uses XRP as fees for transaction confirmation and processing, has also fueled expectations of increased institutional usage. Ripple has stated its intention to invest an undisclosed amount in the newly rebranded Bitwise Physical XRP ETP (formerly known as the ETC Group Physical XRP), as reported on Wednesday. This announcement sent XRP's price soaring by 10% at that time.

The XRP market has witnessed a remarkable transformation over the past few months. The combination of regulatory developments, increased investor confidence, and the potential for institutional adoption has created a favorable environment for XRP. As bulls continue to eye the $2 mark, it will be interesting to see how the market unfolds in the coming days and weeks. Traders and investors alike will be closely monitoring these developments to capitalize on the opportunities presented by XRP's upward trajectory.