Dow Jones futures were little changed after hours, along with S&P 500 futures and Nasdaq futures. The stock market started 2023 like it ended last year, with a flash of strength followed by a reversal in major indexes and top stocks.
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Shares of Apple on Tuesday slid to new bear market lows and fell below a $2 trillion valuation due to reports that Apple (AAPL) yes cut orders for suppliers for its MacBook, AirPod, and Apple Watch products.
Tesla (TSLA) plunged to a market low after record deliveries in the fourth quarter and still failed to post a lower number of views, with demand concerns even greater in 2023.
Investors should wait for clear signs of a sustainable stock market recovery before making new purchases.
LLY Stock, Dow Jones Giant caterpillars (CAT) and recent IPO mobile (MBLY) are three stocks worth watching. MBLY stock is on the rise IBD 50. Eli Lilly is Tuesday IBD shares of the day.
The video is embedded in an article discussing Tuesday’s market action and analysis of CAT, Eli Lilly and Mobileye stocks.
Dow Jones Futures Today
Dow Jones futures contract fell below fair value. S&P 500 futures were little changed and Nasdaq 100 futures were up 0.2%.
The yield on the 10-year Treasury note fell 6 basis points to 3.73%.
At 10 a.m. ET Wednesday, investors will receive the December ISM manufacturing index as well as job openings from the November JOLTS survey, which is the precursor to the December jobs report. on Friday.
Remember that action overnight in future index and other places that don’t necessarily translate into actual transactions the next time stock market meeting.
Join IBD experts as they analyze stocks that could act in the stock market rally on IBD Live
Third Stock Market
The stock market on Tuesday opened higher but briefly headed south before paring significant losses late in the afternoon.
The Dow Jones Industrial Average closed just a fraction of the day on Tuesday stock market trading. The S&P 500 index rose 0.4%, with Tesla stock by far the worst performer. Nasdaq composite fell 0.8%. The Russell 2000 small-cap index fell 0.6%.
U.S. crude oil prices fell 4.2 percent to $76.93 a barrel, after three consecutive weeks of gains. Natural gas prices fell 10.9%, extending a major sell-off in recent weeks.
The yield on the 10-year Treasury note fell 9 basis points to 3.79%, despite falling to an intraday low of 3.72%.
ETFs
Among the best ETFsIBD 50 Innovator ETF (FFTY) fell 1.1%, while Innovator’s IBD Breakthrough Opportunity ETF (HOUR) give up 0.8%. iShares Expanded Tech-Soft Sector Sector ETF (IGV) increased by 0.2%. VanEck Vectors Semiconductor ETF (SMH) decreased by 0.8%.
SPDR S&P Metals & Mining ETF (XME) fell 1.4% and the Global X US Infrastructure Development ETF (PAY THE ROAD RED) flat. US Global Jets ETF (jet plane) decreased by 0.6%. SPDR S&P Homebuilders ETF (XHB) increased by 1.3%. Energy Select SPDR ETF (XLE) slipped 3.5% and the Financial Select SPDR ETF (XLF) inched up 0.35%. SPDR Foundation for healthcare sector (XLV) decreased by 0.3%.
Reflecting more speculative stocks, the ARK Innovation ETF (ARKK) lost 2.5%, not far from last week’s 5-year low. ARK Genomics ETF (ARKG) decreased by 2.1%. Tesla stock is the primary stock held on Ark Invest ETFs.
The five best Chinese stocks to watch right now
apple stock
Shares of Apple fell 3.7% to $125.07 on Tuesday, breaking last week’s bear market low to its worst since June 2021.
AAPL stock, which hit a $3 trillion intraday valuation in early 2022, has now dropped below $2 trillion for the first time since March 2021. Apple stock closed Tuesday with market cap is $1.988 trillion. It’s still the most valuable company in the world.
A giant Foxconn iPhone factory in China has returned to 90% capacity, Bloomberg reports. But Apple is cutting orders for AirPods, MacBooks and Apple Watch products, according to a report.
Tesla shares
Tesla shares fell 12.2% to 108.10, falling below a bear market low last week, hitting their worst level since August 2020. This is the worst single-day loss. of the EV giant for more than two years. TSLA stock is down 37% in December and 65% for all of 2022.
Tesla’s delivery numbers hit a record high in Q4, but for the second straight quarter, they fell short of lower estimates and actual production. That’s despite big year-end incentives, especially in China and the US, to boost sales.
The outlook could be bleak for 2023, with new Tesla EV orders well below current delivery rates.
Bernstein’s Toni Sacconaghi wrote on Sunday, “Tesla’s Q4 annual order rate including significant discounts is only ~1 million units and the company’s goal is to sell close to 2 million units by 2023 without no new models.”
With a low backlog, Tesla may need to offer discounts or offers much higher than the year-end offer just to maintain its Q4 delivery pace in 2023. But that could mean with a big impact on Tesla’s profit margins.
Tesla vs. BYD: Electric car giants vying for the crown, but which is better to buy?
Stock market analysis
The stock market is off to a strong start to 2023 — in 12 minutes. After that, the major indexes quickly corrected, although they fell to intraday lows.
The Dow Jones index reversed lower after briefly breaking above the 50-day and 21-day lines. The S&P 500 and Russell 2000 reversed lower than the 21-day line.
Nasdaq reversed after approaching the 21-day line.
Tesla and Apple stocks are major drags on the major indexes. But there has been a widespread retreat. Energy stocks are big losers with underlying prices.
A lot of interesting stocks open higher but then reverse lower with the major indexes, such as Mobileye, poison (CELH) and space (MEDP).
Eli Lilly and Caterpillar, along with related defensive growth names, have held up relatively well. LLY stock is testing its 50-day/10-week lines.
Stocks focused on China, especially internet networks like Pinduoduo (PDD) and how Macau casinos play Las Vegas Sand Beach (LVS), did not follow the trend, but they also hit highs.
The major indexes eventually limited their losses, but the reversal from key technical levels was not encouraging. Many stocks fell sharply and did not recover. The stock market is in an attempt to recover on the back of last Thursday’s gains, but that looks like a one-day rally.
The market is in a correction phase, with Nasdaq not far from bear market lows. Even if the collective effort gains momentum and stage the next day In the next week or two, there will still be some technical hurdles to be resolved.
Market Timing with IBD’s ETF Market Strategy
What to do now
This is not a good time to take on new positions. It is a market correction with major indices, sectors and individual sectors prone to reversals.
Don’t be tempted by a momentary market boom that pushes the stock into a buy zone. Within a few minutes on Tuesday, some stocks signaled to buy, but most quickly died out. Although the major indexes ended with moderate losses, an investor jumping into MBLY stock near Tuesday’s open could be suffering a 10% loss.
Bottom line: Don’t act as if the market is in an uptrend until the market is actually in an uptrend.
However, many good stocks continue to trade near the buy points, while the market’s recovery attempt could spark a further rally in the coming days. So build your watchlist and stay engaged.
Read Big picture every day to stay in sync with market trends and top stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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