Dow Jones futures rose slightly early Wednesday, along with S&P 500 futures and Nasdaq futures.
The stock market rally retreated modestly Tuesday following a report that Oracle is seeing slim margins from renting out servers loaded with Nvidia chips. Oracle stock fell, along with CoreWeave and many other AI infrastructure plays, but the losses weren't severe.
Tesla unveiled a cheaper Model Y and Model 3 on Tuesday, but they weren't as affordable as many hoped. Tesla stock fell, but edged higher early Wednesday.
On the upside, AppLovin rebounded after APP stock diving Monday on SEC probe report. SoFi Technologies extended Monday's bullish move, clearing key levels.
AppLovin stock is on Leaderboard, with Tesla on the Leaderboard watchlist. AppLovin and SoFi stock are on the IBD 50. Nvidia stock is on the IBD Big Cap 20. Nvidia was Tuesday's IBD Stock Of The Day.
The video embedded in the article reviews Oracle stock, SoFi and Alnylam Pharmaceuticals.
Dow Jones Futures Today
Dow Jones futures advanced 0.2% vs. fair value. S&P 500 futures climbed 0.1% and Nasdaq 100 futures rose 0.1%.
Crude oil futures rose nearly 2%.
The 10-year Treasury yield edged down to 4.1%.
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
The stock market rally retreated as Oracle margin concerns hit AI stocks, but the major indexes all found support slightly above their 10-day moving averages.
The Dow Jones Industrial Average fell 0.2% in Tuesday's stock market trading. The S&P 500 index declined 0.4%. The Nasdaq composite shed 0.7%. The small-cap Russell 2000 slumped 1.1%.
While many leading stocks retreated Tuesday, most held up reasonably well.
On the upside, AppLovin stock jumped 7.6% to 631.85, back above the 21-day line. But that's after diving 14% on Monday on a Bloomberg report that the SEC is probing its data-collection practices.
SoFi stock popped 6.75% to 28.14, moving above its 21-day line and breaking a short downtrend. That's after the fintech rebounded from its 50-day line. Shares are already 11.7% above their 50-day.
Bitcoin, which topped $126,000 on Monday for the first time, tumbled back to $121,662.54 as of 4 p.m. ET Tuesday.
U.S. crude oil prices rose four cents to $61.73 a barrel.
The 10-year Treasury yield fell 3.5 basis points to 4.13%.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF dipped 0.2%, coming well off lows. The iShares Expanded Tech-Software Sector ETF declined 1.1%, with Oracle stock a huge holding and AppLovin a key component as well. The VanEck Vectors Semiconductor ETF slumped 1.8%. Nvidia stock is the dominant holding in SMH.
ARK Innovation ETF sank 2.7% and ARK Genomics ETF retreated 1.25%. Tesla stock is the No. 1 holding across ARK Invest's ETFs.
SPDR S&P Metals & Mining ETF gained 0.75%. SPDR S&P Homebuilders ETF slumped 2.6%. The Energy Select SPDR ETF rose 0.2%. The Health Care Select Sector SPDR Fund was 0.1% higher.
The Industrial Select Sector SPDR Fund sank 0.6%.
The Financial Select SPDR ETF edged up 0.1%.
Best Growth Stocks To Buy And Watch
Oracle Cloud Margins Weak?
Oracle had relatively low margins renting cloud-based servers powered by Nvidia chips in the August-ended quarter, The Information reported Tuesday, citing internal documents. The software giant lost nearly $100 million from rentals of Nvidia's most-advanced Blackwell chips.
However, a Fox Business reported that The Information article was "off base."
Oracle stock fell 2.4% to 284.24, off intraday lows. Shares are down 17.7% since hitting a record 345.72 on Sept. 10, when Oracle announced a huge deal with OpenAI.
ORCL edged higher before the open.
CoreWeave stock fell 3.75% to 128.83, but held above its 21-day line. CRWV rose slightly early Wednesday.
Nvidia stock came off intraday highs on the Oracle news, edging down 0.3% to 185 on Tuesday. Shares are holding a 184.48 flat-base buy point. NVDA rose a fraction before the open.
Tesla Cheaper Model Y Isn't So Cheap
Tesla priced the new Model Y Standard variant at $39,990, with the Model 3 Standard at $36,900. Those are $5,000 and $5,500 cheaper than the old base variants, now the Premium RWD.
The new variants have significantly reduced content, including shorter battery ranges, to lower Tesla's costs. The cheaper models don't have Autopilot — owners must buy Full Self-Driving to get driver-assist software. They also don't come with AM/FM radio, a backseat display and much more.
The lower cost will help preserve margins and avoid cannibalization with the traditional variants. However, the now-expired tax credits complicate the picture.
Until Sept. 30, U.S. buyers could get a base Model Y for $37,490 with the $7,500 tax credit. So it's unclear how much U.S. demand there will be for these variants that effectively offer less for more money.
The cheaper models could do better in overseas markets.
Early Tuesday, Tesla released Full Self-Driving V14 to some users.
Tesla stock fell 4.45% to 433.09 on Tuesday. That's after jumping 5.45% in anticipation of Tuesday's big news.
Shares rose a fraction early Wednesday.
Nvidia CEO Spurs AI-Led Rally; Tesla Has New Buy Point
What To Do Now
The stock market rally suffered some losses Tuesday, the major indexes still look fine. Even Oracle, a big catalyst for the selling, finished relatively well.
Still, it's a reminder that if the AI boom thesis takes a knock, as it did earlier this year on Deepseek concerns, the stock market could suffer sharp losses.
So stay engaged and have your exit strategies up to date.
Work on watchlists. With the market at highs and acting well, investors should still be seeking new opportunities.
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Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.
