Dow Jones futures were little changed Thursday morning, along with S&P 500 futures and Nasdaq futures.
X
The stock market rally suffered more losses to start 2024, as the Nasdaq suffered a 1%+ decline for the second day in a row, adding its losing streak to four sessions. Market losses widened significantly.
Eli Lilly (LLY) rose strongly, surpassing a second early entry after a buy signal appeared on Tuesday.
Bitcoin fell hard on Wednesday, with the SEC expected to approve bitcoin ETFs within days. Notable cryptocurrencies such as COIN stocks, Digital Marathon (Mara) and Accurate strategy (MSTR) fell on Wednesday morning Coinbase (COIN) and MARA stocks have rebounded nicely from their lows.
Tesla (TSLA) was a notable loser, although the action may ultimately be constructive.
Cathie Wood's Ark Invest bought Tesla shares on Wednesday, while selling some COIN shares.
apple (AAPL) fell early Thursday after a second analyst downgraded AAPL stock in 2024, citing weak iPhone sales.
TSLA stock dropped from the IBD Leaderboard on Wednesday. Eli Lilly stock is on SwingTrader.
Dow jones futures today
Dow Jones futures rose 0.1% above fair value. S&P 500 futures were flat and Nasdaq 100 futures fell 0.1%.
The yield on 10-year Treasury bonds rose to 3.96%.
Crude oil futures rose 1%.
Remember, an overnight move in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
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Stock market pool
The stock market rally suffered further losses on Wednesday.
The Dow Jones Industrial Average fell 0.8% in stock market trading Wednesday, along with the S&P 500. The Nasdaq Composite Index fell 1.2%.
Market breadth was weak on Wednesday, after holding up relatively well on Tuesday.
The small-cap Russell 2000 stock fell 2.7%.
The Invesco S&P 500 ETF (RSP), which rose a fraction on Tuesday, fell 1.5% on Wednesday.
The Nasdaq closed below its 21-day moving average for the first time since November 1, while the Russell 2000 also fell at that level. The S&P is approaching the 21-day line.
Many blue-chip stocks saw further losses, although some are trying to find key support.
US crude oil prices jumped by 3.3% to $72.70 per barrel.
The 10-year Treasury yield fell 4 basis points to 3.905% after briefly reaching 4.01% in the morning.
Fed officials at the December meeting expected to cut interest rates in 2024, but the path is unclear, according to meeting minutes released Wednesday afternoon. Earlier, the December ISM manufacturing index rose but still indicated contraction. Job openings decreased in November but were slightly higher than expected.
The December jobs report will be in focus on Friday morning.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF (IGV) fell 1.6%. The VanEck Vectors Semiconductor ETF (SMH) fell 1.8%.
Reflecting more speculative stocks, the ARK Innovation ETF (ARKK) fell 3.9% and the ARK Genomics ETF (ARKG) fell 4.6%.
SPDR S&P Metals & Mining ETF (XME) shares fell 1.9%. US Global Jets ETF (JETS) fell 3.9%. Shares of the SPDR S&P Homebuilders ETF (XHB) fell 2.7%. The Energy Select SPDR ETF (XLE) rose 1.6%.
Healthcare Sector SPDR Fund (XLV) was down 0.2%, with LLY stock a significant component.
The Select Industrial Sector SPDR Fund (XLI) gave up 1.5%.
The Financial Select SPDR ETF (XLF) was down 0.85%.
Tesla struggles for support as rival races in electric vehicle sales surge
Bitcoin price
Bitcoin was down 4.7% to $42,952.22 as of 5pm EST on Wednesday, coming off intraday lows from a brief decline that sent it down $40,000. This after rising above $45,000 on Tuesday, the first time the cryptocurrency has exceeded this level since April 2022.
Bitcoin has soared over the past year, especially since the end of September, on hopes that the SEC will approve bitcoin ETFs, opening the door to broader institutional participation. This is expected within several days.
Fox Business reported late Wednesday that the Securities and Exchange Commission may approve the issuance of bitcoin exchange-traded funds on Friday, with trading starting next week.
Bitcoin investor MicroStrategy fell 7.7% to 632.29. On Tuesday, MSTR stock reached 727.77, its highest level in two years.
Bitcoin miner Marathon Digital fell to a low of 20.39, undercutting its 21-day streak, before rebounding to post a 2.4% gain to 23.48. MARA stock fell after hitting a 20-month high of 30.30 on December 27.
Cryptocurrency exchange Coinbase fell 2.8% to 152.45, but is a long way from its intraday low of 144.11. COIN stock reached a 20-month high of 187.39 on December 28.
Bitcoin was trading just above $43,000 early Thursday.
Cathie Wood buys Tesla, sells coins
On January 3, Cathie Wood's Ark Invest bought 105,201 shares of Tesla stock, worth $25.09 million based on TSLA's closing stock price. Leading Ark Innovation ETF (ARKK) bought 91,194 shares of Tesla stock while ARK Next Generation Internet ETF (ARKW) added 14,007 shares.
Meanwhile, ARKK sold 145,048 shares of Coinbase, while ARKW sold 21,135 shares, for a total of 166,135 shares. This equates to $25.29 million based on COIN stock's close on Wednesday.
ARK Autonomous Technology & Robotics ETF (ARKQ) bought 27,324 shares of its stock Rocket Lab USA (RKLB), valued at approximately $140,000.
Cathie Wood often buys stocks that are selling off, while reducing her stock holdings when they rise. Ark last bought Tesla shares on December 20, the first time in eight months.
COIN stock is the #1 stock in Ark Invest's ETFs. Tesla stock remains a staple of Cathie Wood's Ark.
Eli Lilly Stock
LLY stock rose 4.3% to 617.70 on above-average trading volume, moving decisively above a key resistance level around 600, providing entry for investors. On Tuesday, shares rose 1.6%, moving back above the 50-day line and the downtrend line. This was also a buying opportunity. Eli Lilly stock has an official firm-base buy point of 629.97.
Tesla shares
TSLA stock fell 4% to 238.45 on Wednesday, falling below the 21-day line but finding support at the 10-week line. Analysts were not impressed by Tesla's record deliveries, released Tuesday morning. The relative strength line is not far from the October lows.
Tesla stock needs to find support, but if it does, the latest action could be constructive. The electric car giant ended 2023 with a small handle on the weekly chart with a buy point of 265.13. Now, the depth of this handle, effective on the daily chart after Thursday, is 11%. This provides a more meaningful jolt.
The next big catalyst will be Tesla's fourth-quarter earnings, scheduled for January 24.
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What are you doing now
In hindsight, investors will be able to look at the charts and declare that it was “obvious” that the Nasdaq and leading stocks would fall below key support — or bounce from those levels.
But it is no Obvious, especially for individual stocks. Tesla shares, along with Microsoft (MSFT), Service now (now), Netflix (NFLX) and others, may rally bullishly from their 10-week lines in the coming days. But some or all of these prices may fall instead.
The Nasdaq may be about to stabilize and then rebound soon, or it may pull back to the top of its previous range and test the 50-day line.
Now, it's time to wait and see how the market shakes out. There's a lot of settings going on, so keep your watchlists up to date.
Investors can choose to add exposure if leading names flash buy signals, but do so gradually, especially in the current environment.
Taking some profits is still not a bad idea, especially if you haven't done so in the last few sessions.
Read The Big Picture every day to stay on top of market trend and leading stocks and sectors.
Please follow Ed Carson on Threads at @edcarson1971, and X/Twitter at @IBD_ECarson And Bluesky at @edcarson.bsky.social for stock market updates and more.
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