Dow Jones futures fell modestly early Thursday, while S&P 500 futures and Nasdaq futures rose slightly. Tesla and Google-parent Alphabet beat views. Google stock rose overnight while Tesla stock tumbled on the conference call, with CEO Elon Musk touting robotaxis but also seeing a "few rough quarters" ahead.
ServiceNow and IBM were among other notable earnings reports.
The stock market rally rose on Wednesday, with the S&P 500 hitting highs and Dow Jones nearly doing so. Stocks were buoyed by a Japan trade deal that will set 15% tariffs on Japanese goods as well as a report that the U.S. is near a similar deal with the European Union.
Power producers jumped Wednesday, with GE Vernova surging on earnings and Vistra clearing a buy point. Both are on IBD Leaderboard.
The video embedded in the article discusses Wednesday's stock market action and analyzes Vistra stock, SwingTrader stock Veeva Systems and Axon Enterprise. There's also an initial after-hours look at Tesla, Google stock and other after-hours earnings reports.
Dow Jones Futures Today
Dow Jones futures fell 0.4% vs. fair value, with IBM weighing on shares. S&P 500 futures rose 0.1% and Nasdaq 100 futures climbed 0.3%. Google and ServiceNow provided a lift while Tesla was a drag.
The 10-year Treasury yield edged up to 4.41%.
Crude oil futures edged higher.
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 had another solid session, with the S&P 500 at fresh record highs. Many growth stocks that tumbled Tuesday morning bounced back Wednesday. Along with power producers, a number of Chinese stocks and ETFs made strong moves.
The Dow Jones Industrial Average jumped 1.1% in Wednesday's stock market trading, the highest since late January and almost at record levels. The S&P 500 index advanced 0.8%. The Nasdaq composite climbed 0.6%. The small-cap Russell 2000 leaped 1.5% to a five-month best.
U.S. crude oil prices fell six cents to $65.25 a barrel.
The 10-year Treasury yield rose five basis points to 4.39%.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF jumped 1.8%. The iShares Expanded Tech-Software Sector ETF climbed 0.8%, with ServiceNow stock a big IGV holding. The VanEck Vectors Semiconductor ETF advanced 0.4%.
ARK Innovation ETF gained 1.2% and ARK Genomics ETF popped 2.4%. Tesla stock is the No. 1 holding across ARK Invest's ETFs.
SPDR S&P Metals & Mining ETF climbed 0.4%. SPDR S&P Homebuilders ETF gained 0.85%. The Energy Select SPDR ETF ran up 1.6% and the Health Care Select Sector SPDR Fund shot up 2.05%.
The Industrial Select Sector SPDR Fund popped 1.8%
The Financial Select SPDR ETF rose 0.8%.
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Tesla Earnings
Tesla earnings fell 23% to 40 cents a share, in line view views. Revenue declined 12% to $22.496 billion, slightly beating.
Automotive revenue fell once again while Tesla Energy revenue declined vs. a year earlier.
Regulatory credits fell to $439 million vs $595 million in Q1 and $890 million in Q2 2024. ZEV (zero emission vehicle) credit revenue is likely to trend lower.
Tesla said in the Q2 earnings release that it did produce some initial builds of the "affordable" vehicle in June, with "volume" output later this year. Musk said the new EV will "look just like the Model Y," a further signal that it'll be a stripped-down MY. Another Tesla executive said deliveries won't start until at least Q4, after $7,500 U.S. tax credits end Sept. 30.
Musk was bullish on robotaxis during the conference call, predicting a rapid expansion within Austin and in key markets, pending "regulatory approval."
But he said a "few rough quarters" are likely after Q3, without tax credits.
Tesla stock tumbled 6% in premarket trade, signaling an undercut of 50-day line and 200-day.
Shares edged up 0.1% to 332.56 on Wednesday. Shares have forged a new base within a big, deep consolidation. The buy point is 367.71, according to MarketSurge.
However, the relative strength line is rather weak and TSLA stock faces a lot of overhead resistance.
Google Earnings
Google earnings topped views with key segments also topping, especially the cloud-computing arm. The tech giant also will step up spending plans. That should be good news for Nvidia and AI hardware plays.
Google stock rose more than 3% in extended trading. Shares dipped 0.6% on Wednesday to 190.23, snapping a 10-session win streak and just edging back into a buy zone from a cup-with-handle base. The buy point is a 181.23. The RS line has been improving, signaling that GOOGL stock is outperforming the S&P 500 index after a long stretch of keeping pace or lagging.
ServiceNow, IBM Earnings
ServiceNow earnings beat views with the software giant guiding higher. NOW stock jumped in premarket trade, signaling a move back above key moving averages. ServiceNow stock had plunged after a failed breakout in early July.
IBM earnings topped but software sales slightly missed. IBM stock fell solidly in extended action. Shares rose 5 cents to 282.01 on Wednesday, back above the 21-day line. IBM has been consolidating for a few weeks after a strong June move out of a base.
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What To Do Now
The stock market is at record highs. The Nasdaq slightly lagging for a bit while other indexes step up is probably a positive.
Growth stocks are still prone to abrupt losses, but the general trend is strong for leaders.
The huge wave of earnings and other news through next week could trigger big swings in the broader market, sectors and especially individual stocks. So investors will have to decide whether to hold all or part of their positions through earnings reports. They may want to be careful about new buys for the next few days.
But investors should be heavily invested and working on watchlists.
Read The Big Picture every 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.
