Dow Jones futures rose early Friday, along with S&P 500 futures and especially Nasdaq futures. Microsoft (MSFT) jumped and Google parent Alphabet (GOOGL) soared on earnings, leading another big night of quarterly results.
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The stock market rally attempt suffered sharp losses Thursday morning as Meta Platforms (META) tumbled on guidance and a GDP report showing slower-than-expected growth and hot inflation. But the major indexes slashed losses.
Nvidia (NVDA), Broadcom (AVGO) and other AI chip and hardware plays rebounded on Meta's hefty capital spending plans.
Meanwhile, a number of non-tech sectors and leading stocks advanced. Notably Chipotle Mexican Grill (CMG) broke out on earnings, with several other restaurant stocks making bullish moves.
The market rally attempt showed some resilience Thursday, but it hasn't proved anything yet. Investors need patience.
Microsoft and Google earnings, guidance and spending plans will have a huge impact on so many sectors.
Dexcom (DXCM) and Western Digital (WDC)were among the hundreds of other companies reporting Thursday night.
Early Friday, Dow giant Chevron (CVX) and Exxon Mobil (XOM) reported mixed results.
Investors on Friday also will get the March reading for the core PCE price index, the Fed's favorite inflation report. That data may have less market impact given Thursday's Q1 PCE data in the GDP report.
Nvidia stock is on IBD Leaderboard. Microsoft stock is on the IBD Long-Term Leaders list. Google stock is on the IBD 50 and the IBD Big Cap 20. Chipotle was Thursday's IBD Stock Of The Day.
Dow Jones Futures Today
Dow Jones futures rose 0.1% vs. fair value. Microsoft's gains were offset somewhat by Intel and Chevron. S&P 500 futures gained 0.7%. Nasdaq 100 futures jumped 0.9%, but off overnight highs. Microsoft is also a major S&P 500 and Nasdaq component, along with Google stock.
The 10-year Treasury yield edged down to 4.68%.
Crude oil futures rose slightly. Copper climbed more than 1%.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
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Stock Market Rally Attempt
After bouncing Monday-Tuesday and stalling Wednesday, the stock market rally attempt sold off Thursday morning on Meta Platforms and the hot inflation reading in the GDP report. The major indexes did come well off early lows, but it was a down session.
The Dow Jones Industrial Average fell 1% in Thursday's stock market trading, with IBM (IBM) and Caterpillar (CAT) tumbling on weak sales. The S&P 500 index sank 0.5%. The Nasdaq composite retreated 0.6% after plunging 2.35% shortly after the open. The small-cap Russell 2000 gave up 0.7%
Meta stock plunged 10.6% to 441.38, though it did come off lows of 414.50. Nvidia stock rallied 3.7% to 826.32 though still below its 50-day line. Broadcom stock rose 3%, hitting resistance at the 50-day line. 50-day. Arista Networks (ANET), which counts Meta and Microsoft as its two-biggest customers, popped 3.85%.
A follow-through day could come at any time to confirm the new market rally attempt. Microsoft and Google could provide that catalyst. But it's also possible that the market heads lower and a longer correction takes hold.
U.S. crude oil prices rose 0.9% to $83.57 a barrel.
The 10-year Treasury yield climbed 5 basis points to 4.71%, the highest since Nov. 1. The two-year Treasury yield, a good proxy for the Fed rate outlook, is back to the 5% level.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF (IGV) fell 0.9%. Microsoft is a huge IGV member. The VanEck Vectors Semiconductor ETF (SMH) gained 2%, with NVDA stock the largest component and Broadcom a key holding.
SPDR S&P Metals & Mining ETF (XME) rebounded 1.7%. SPDR S&P Homebuilders ETF (XHB) dipped 0.2%. The Energy Select SPDR ETF (XLE) advanced 0.5% with Exxon and Chevron accounting for 40% of the ETF's holdings. The Health Care Select Sector SPDR Fund (XLV) fell 0.6%, with Dexcom stock a holding.
The Industrial Select Sector SPDR Fund (XLI) edged up 0.3%. The Financial Select SPDR ETF (XLF) declined 0.5%.
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Microsoft Earnings
Microsoft earnings and revenue growth modestly beat views. Revenue from Azure and other cloud services grew 31%, beating views and picking up from fiscal Q2's 30%.
The Dow tech titan was bullish about AI demand on the conference call. Microsoft forecast strong cloud growth going forward, though it was somewhat cautious on overall profit and revenue. It expects capital spending to increase "materially" in the current Q4.
Microsoft stock rose solidly in extended trade, suggesting a move back to the 50-day line. Shares fell 2.45% on Thursday to 399.04 after hitting a three-month low of 388.03 intraday.
Nvidia stock climbed modestly overnight on the continued Big Tech spending blitz, signaling a possible 50-day test. Arista, which counts Microsoft as a huge customer along with Meta Platforms, also advanced.
Several software stocks that retreated Thursday on ServiceNow (NOW) rebounded overnight on Microsoft.
Google Earnings
Google earnings surged 61%, easily beating views. Google Cloud, YouTube ads and online search ad revenue growth all topped expectations.
Google announced its first-ever quarterly dividend of 20 cents a share, as well as a $70 billion buyback.
Google stock skyrocketed more than 10% in overnight action. Shares fell as low as 150.87 Thursday morning, recovering to close down 2% at 138.01. GOOGL stock closed in range of buy points at 152.15 and 153.78.
Other Earnings
Dexcom earnings beat views. The diabetes products giant raised full-year sales guidance, but it was a little light at the midpoint. Shares fell solidly in premarket trade, signaling a move to or below a buy point. Dexcom stock edged up 0.1% to 138.01 on Thursday, holding in range of a 132.03 flat-base buy point. Shares have been consolidating for the past few weeks and finding 50-day line support.
Western Digital earnings topped views but fiscal Q4 sales guidance was a bit light. WDC stock rose slightly early Friday after dipping overnight. Shares of the memory play dipped 0.2% to 69.44 on Thursday, rebounding from an intraday test of the 10-week line and a 65.92 ascending base buy point.
Meanwhile, T-Mobile US (TMUS), Intel (INTC), Snap (SNAP), Roku (ROKU), KLA (KLAC) and Atlassian (TEAM) were the many other earnings reports late Thursday.
Chevron Earnings Mixed
Chevron earnings topped views but revenue came in short. Exxon earnings missed but it beat on revenue. Squeezed refining margins and lower natural gas prices pressured both energy giants.
CVX stock lost a fraction early Friday, signaling a move below a buy point. Chevron stock rose 1% to 165.27 on Thursday, clearing a 163.87 cup-with-handle entry.
XOM stock fell slightly, still in range of a 120.70 saucer-base buy point. Shares rose 0.3% to 121.36 on Thursday,. Exxon stock has a three-weeks-tight entry of 123.75, which could also serve as a high handle buy point.
Chipotle Stock Leads Restaurant Rally
Chipotle earnings beat views, with growth accelerating for a second straight quarter. CMG stock surged 6.3% to 3,111.97, decisively clearing a 3,023.98 buy point from a three-weeks-tight.
Wingstop (WING) climbed 2% to 369.90, rebounding from the 10-week line to near the top of a range going back to early March. But earnings are due May 1.
Cava Group (CAVA) reversed higher, rising 3.6% to 62.59, retaking the 50-day line and a steep downtrend, offering an entry. Cava earnings aren't due for several weeks.
What To Do Now
The market is in a correction. This week, a market rally attempt has gotten underway, but hasn't signaled a real character change yet.
Waiting doesn't mean sitting on your hands. It's important to be ready for that next market turn, whether that comes Friday, next week or months down the road.
Some energy, infrastructure, financial, medical and restaurant stocks continue to do well. But most techs need some or a lot of repair work.
So cast a wide net for your watchlists and stay engaged with the market. Look for stocks holding or regaining support, showing relative strength in a weak market.
ReadThe Big Pictureevery day to stay in sync with the market direction and leading stocks and sectors.
Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.
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