Dow Jones Futures Rise, Tesla Pops On Bullish Elon Musk As Market Rally Shows

Dow Jones futures and S&P 500 futures rose modestly early Thursday, while Nasdaq futures were solidly higher. Tesla (TSLA) jumped as Elon Musk was bullish following mixed Q4 earnings.  ServiceNow (NOW) and Lam Research (LRCX) also reported after the close. Dow Jones giant Chevron (CVX) announced a mammoth buyback, with CVX stock flashing a possible buy signal.

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United Rentals (URI), Steel Dynamics (STLD), Teradyne (TER) and IBM (IBM) were among the many other companies reporting overnight.

The stock market rally stumbled Wednesday morning as Microsoft (MSFT) and Boeing (BA) were among the early earnings-related losers. The major indexes tested or undercut key levels but came well off lows, closing at or near intraday highs for a fourth straight session. A key reason: Boeing reversed slightly higher and MSFT stock slashed losses.

URI stock is on IBD Leaderboard. United Rentals, Lam Research and STLD stock are on the IBD Big Cap 20.

Dow Jones Futures Today

Dow Jones futures were 0.2% above fair value, with CVX stock and IBM both blue chips. S&P 500 futures climbed 0.5% and Nasdaq 100 futures popped 0.9%. Tesla stock, LRCX, NOW and STLD stock are S&P 500 and Nasdaq 100 stalwarts.

The 10-year Treasury yield edged up 3 basis points to 3.49%.

Crude oil futures rose more than 1%. Natural gas continued to plunge.

Early Thursday, investors will get their first read on fourth-quarter economic growth. The GDP report will also include the quarterly PCE price index, providing a strong signal for the December PCE inflation reading on Friday morning. Also Thursday, durable goods orders, new-home sales and jobless claims are on tap.

Hong Kong’s Hang Seng index rallied 2.4% Thursday after being closed three days for Lunar New Year celebrations. The Shanghai exchange is closed all week.

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

Tesla Earnings

Tesla earnings slightly topped analyst views, which had come down significantly in the past few weeks. Revenue just missed, according to FactSet, though it beat some other estimates. Tesla recognized $324 million in Full Self-Driving revenue, which drove the EPS beat.

Automotive gross margin fell to 25.9% from 27.9% in Q3 and 30.6% a year earlier. That was below consensus. Gross margins are expected to fall significantly in 2023 following sweeping price cuts worldwide earlier this month.

CEO Elon Musk was bullish on the conference call. He said orders were double production right now following the price cuts. But the question is how strong demand will remain in the coming weeks and months.

Tesla officially expects production of 1.8 million vehicles, but Musk said two million is the internal goal. Tesla produced 1,369,611 vehicles in 2022, delivering 1,313,851. Output topped deliveries by an increasing amount in the past three quarters.

Tesla confirmed it doesn’t plan to further expand capacity at its massive Shanghai facility, which suspended production at the end of 2022 due to insufficient demand.

Musk said Cybertruck output will begin by the summer, but “volume production” may not happen until…