Dow Jones futures, along with S&P 500 futures and Nasdaq futures, edged lower on Friday morning. FedEx (FDX) is set to break out on earnings, while Tesla (TSLA), Lululemon Athletica (LULU), and Nike (NKE) retreated.
The major indexes reached record highs on Thursday, but came off those highs, especially the Nasdaq. Apple (AAPL) was a drag on the market as the Justice Department filed an antitrust lawsuit against the iPhone giant.
Despite the pullback, several stocks flashed buy signals, including CyberArk Software (CYBR), Neurocrine Biosciences (NBIX), and On Holding (ONON).
However, on Friday, Tesla stock fell due to a report that the electric vehicle giant is cutting production at its huge Shanghai plant. Lululemon and Nike also experienced declines due to weak outlooks. In contrast, FedEx stock surged on strong earnings and guidance.
In terms of futures, Dow Jones futures fell 0.1% versus fair value, with Nike stock serving as a blue-chip drag. S&P 500 futures lost 0.2%, while Nasdaq 100 futures fell 0.3%, mainly due to Tesla and Lululemon.
The 10-year Treasury yield experienced a slight dip to 4.24% after remaining steady on Thursday.
The yuan significantly fell overnight to a multimonth low against the dollar as China signaled it would allow the currency to decline. Other Asian currencies also retreated.
Bitcoin, gold, and copper all fell as the dollar climbed, continuing its upward trend in 2024.
It’s important to remember that premarket action in Dow futures and elsewhere does not necessarily reflect actual trading in the next regular stock market session.
Looking at the market’s performance on Thursday, the Dow Jones Industrial Average climbed 0.7% in stock market trading, with the S&P 500 index rising 0.3% and the Nasdaq composite ending up 0.2%.
In terms of individual stocks, CyberArk stock gained 1.7% on Thursday, breaking a tight trendline. It has rebounded from the 10-week line this week but in light volume. CyberArk is potentially on track to establish a new base after Friday with a buy point of 283. Neurocrine Bio stock increased by 2.2% to 143.74, enough to clear a 143.35 flat-base buy point. On Holding rose by 2.5% to 35.61, just topping a 35.58 cup-with-handle base buy point.
Earnings reports for major companies are also making headlines. FedEx earnings outperformed expectations, while guidance was strong, aiding a move above a buy point from a three-month consolidation. Lululemon earnings exceeded views, but the yoga apparel retailer’s guidance was lower than expected. As a result, Lululemon stock sold off significantly in premarket trade. Nike earnings beat estimates, but weak guidance provided on the analyst call led to a decline in shares.
In regards to Tesla’s operations in China, the company has reduced production at its Shanghai plant to five days a week from 6.5 days, according to sources. The output cuts began earlier this month and may continue through April. This decision reflects slower electric vehicle growth in China, the world’s largest auto market.
Tesla’s first-quarter global deliveries are expected to be well below Wall Street estimates, indicating weaker demand in China, Europe, and other key markets. Tesla recently announced plans to slightly raise China list prices on April 1, following similar plans in the U.S. and Europe. However, it remains uncertain if higher list prices will motivate buyers, given significant discounts on existing inventory levels worldwide. Competitors have also been adding or upgrading electric vehicles at aggressive prices in China.
As a result of these events, Tesla stock fell more than 4% before the market opened. With a decrease of 30.45% through March 21, Tesla is currently the S&P 500’s biggest loser in 2024.
Considering the potential future trends related to these themes, it is evident that the stock market is volatile and influenced by various factors, including economic indicators, corporate earnings reports, and market sentiment. It is crucial for investors to stay updated on market trends and make informed decisions based on thorough analysis.
With the rise of electric vehicles, it is anticipated that the competition in this sector will intensify, potentially affecting Tesla’s market share. Additionally, fluctuations in currencies, such as the yuan, can impact trade dynamics and affect the global market.
The current market environment also