Dow Jones futures, S&P 500 futures, and Nasdaq futures all moved lower on Friday morning. FedEx (FDX) is expected to break out after earnings, while Tesla (TSLA), Lululemon Athletica (LULU), and Nike (NKE) saw declines.
X
The major indexes reached record highs on Thursday but pulled back, especially the Nasdaq. Apple (AAPL) faced pressure as the Justice Department filed an antitrust suit against the tech giant.
Despite the market fluctuations, several stocks showed buy signals, including CyberArk Software (CYBR), Neurocrine Biosciences (NBIX), and On Holding (ONON).
On Friday, Tesla’s stock declined following reports of reduced production at its Shanghai plant. Lululemon and Nike also experienced drops due to weak outlooks. In contrast, FedEx stock surged on strong earnings and guidance.
Dow Jones Futures
Dow Jones futures were down 0.1% compared to fair value, with Nike stock impacting the blue-chip index. S&P 500 futures dropped by 0.2%, while Nasdaq 100 futures fell 0.3% primarily due to declines in Tesla and Lululemon.
The 10-year Treasury yield experienced a slight decrease to 4.24% after holding steady the previous day.
The yuan depreciated significantly against the dollar, reaching a multi-month low as China hinted at allowing the currency to devalue. Other Asian currencies also saw declines.
Bitcoin, gold, and copper all fell while the dollar continued its upward trend in 2024.
It’s important to note that premarket movements in Dow futures and other markets may not accurately reflect actual trading in the subsequent regular stock market session.
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The Dow Jones Industrial Average gained 0.7% in Thursday’s stock market trading, while the S&P 500 index and Nasdaq composite rose by 0.3% and 0.2% respectively.
Stocks In Buy Areas
On Thursday, CyberArk stock increased by 1.7% to 270.12, breaking a tight trendline. The stock has rebounded from the 10-week line this week, setting up for a new base with a 283 buy point. The cybersecurity firm saw a fractional rise before the market opened.
Neurocrine Biosciences shares rose by 2.2% to 143.74, clearing a 143.35 flat-base buy point. However, the stock was well off its intraday highs. NBIX stock showed modest gains early on Friday.
On Holding saw a 2.5% increase to 35.61 on Thursday, surpassing a 35.58 cup-with-handle base buy point. Although the stock retraced slightly overnight amid Nike’s guidance decline, it could still be above an early entry point.
The Swiss-based On Holding experienced a significant drop and rapid recovery last week following its earnings report.
Earnings
FedEx’s earnings exceeded expectations, accompanied by strong guidance that offset a minor revenue miss. FDX stock surged by over 10% before the market opened, signaling a potential breakout above a 285.53 buy point from a three-month consolidation.
Lululemon’s earnings beat estimates, but the company’s guidance was conservative. As a result, LULU stock plummeted by more than 10% in premarket trading, despite showing a strong performance on Thursday.
Nike also posted impressive earnings figures, but weak guidance provided during the analyst call led to a decline in the stock price. The company has been struggling, trading below its 50-day and 200-day moving averages.
Tesla China
Tesla has reportedly reduced production at its Shanghai plant to five days a week from 6.5 days. This decision was made due to slowing EV growth in China, the largest auto market globally.
Shanghai exports have declined in recent months, and the Tesla Berlin factory is operating below full capacity. Additionally, on Thursday, Li Auto (LI) lowered its first-quarter delivery forecast, indicating a significant decrease in March sales compared to earlier predictions.
There are indications that Tesla’s Q1 global deliveries may fall short of Wall Street estimates, reflecting weak demand in China as well as other key markets like Europe.
Earlier this week, Tesla announced plans to raise prices in China starting April 1. However, with existing inventory levels offering significant discounts globally, it remains uncertain if higher list prices will drive consumer demand.
Raising prices in China, where competitors are aggressively introducing or upgrading EV models at competitive prices, presents a challenge for Tesla.
Tesla Stock
Tesla stock dropped by over 4% before the market opened. TSLA stock has declined by 30.45% year-to-date, making it the worst performer in the S&P 500 in 2024.
Li Auto stock also fell by 3% early on Friday after a 7.5% decline the previous day.
For daily market insights and updates on leading stocks and sectors, read The Big Picture regularly.
For stock market updates and more, follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson.
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