Dow Jones Futures: Market Rally Holds Key Levels, Salesforce Rises; Don’t Fall

Dow Jones futures and S&P 500 futures rose slightly early Wednesday, while Nasdaq futures tilted lower. Salesforce.com (CRM) headlined key earnings after the close, with Nio and other China EV makers releasing rebounding May sales before the open.

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The stock market rally closed Tuesday mixed after initially retreating, with the Nasdaq holding a key level after last week’s big advance.

The market is in a confirmed uptrend, and investors have a green light to add some exposure. But don’t fall into the trap of buying hot stocks that are extended, such as Schlumberger (SLB) and Albemarle stock.

Key Earnings

Salesforce and HP Inc. (HPQ) reported after the close.

Salesforce earnings fell but beat views. Guidance was middling-to-light. But CRM stock jumped 8% in premarket trade. Shares recently hit a two-year low, but the business software giant is still an industry bellwether.

HP earnings also topped views while the printer-and-PC giant raised the low end of its full-year EPS target, though the overall outlook was roughly in line. HP stock edged higher in extended trade. Shares edged up 0.2% in Tuesday’s regular session to 38.84, the fourth straight gain as they rebounded from the 200-day line and reclaimed the 50-day line. HP stock has a 41.57 consolidation buy point, but 39.81 could serve as an early entry.

China EV Sales

Meanwhile, China EV makers Nio (NIO), Xpeng (XPEV) and Li Auto (LI) reported May deliveries before Wednesday’s market open, with significant increases from April but still below pre-lockdown levels.

Nio stock jumped on Tuesday, along with Xpeng and Li Auto on easing Covid restrictions, improving economic data and various new EV incentives. But all three are in downtrends.

China EV and battery giant BYD (BYDDF) will likely release May sales on Friday, after defying Covid impacts with record sales in April. BYD stock is still in range of an early buy point.

Tesla (TSLA) China sales will be released in another week or two as Shanghai plant production recovers. TSLA stock rebounded somewhat from 2022 lows late last week.

The video embedded in this article discussed Tuesday’s market action and analyzed Schlumberger stock, Albemarle (ALB) and ADM (ADM).

ALB stock is are on IBD Leaderboard. ADM stock is on SwingTrader.

Dow Jones Futures Today

Dow Jones futures rose 0.3% vs. fair value. CRM stock is a Dow Jones component. S&P 500 futures advanced a fraction and Nasdaq 100 futures dipped 0.15%.

The 10-year Treasury yield rose 2 basis points to 2.86%.

U.S. crude oil futures climbed more than 1%.

China’s private Caixin manufacturing index rose 2.1 points in May to 48.1, just above estimates. That follows a much-stronger-than-expected official factory gauge. Both were below the 50 level, but pointed to a slower decline as Covid restrictions eased. Shanghai largely ended lockdowns as of June 1.

Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.

Join IBD experts as they analyze actionable stocks in the stock market rally on IBD Live

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