Stock Market Rally Attempt Begins; Tesla Jumps Amid EV Credit

On Dec 30, 2022

Dow Jones futures tilted lower after hours, along with S&P 500 futures and Nasdaq futures, heading into the final trading day of 2022. The major indexes rose strongly Thursday on jobs data, Apple (AAPL) iPhone news and Tesla (TSLA) continuing to bounce.

But the market is in a correction after breaking key levels Wednesday. Thursday marked just day one of a new stock market rally attempt. Investors should be very cautious about taking new positions.

Medpace (MEDP) flashed a buy signal Thursday, while KLA Corp. (KLAC), Starbucks (SBUX), United Rentals (URI), Mobileye (MBLY), Super Micro Computer (SMCI) and Fluor (FLR) are setting up. But these stocks will likely rise or fall with the market.

MEDP stock, Fluor and United Rentals are on IBD Leaderboard. KLAC stock is on IBD Long-Term Leaders. MBLY stock is on the IBD 50. KLA Corp. and URI stock are on the IBD Big Cap 20.

Meanwhile, new Treasury Department guidelines stated that many Model Y vehicles will not qualify for U.S. tax credits starting Jan. 1 without sharp price cuts. But there’s a loophole that may allow all Tesla vehicles — and any EVs — to qualify for hefty tax credits at any price.

Dow Jones Futures Today

Dow Jones futures declined 0.1% vs. fair value. S&P 500 futures fell 0.2%. Nasdaq 100 futures slipped 0.2%.

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

Market Rally Attempt

The stock market had a strong rebound, running up during the morning and then holding those gains in the afternoon.

The Dow Jones Industrial Average rose just over 1% in Thursday’s stock market trading. The S&P 500 index popped 1.75%. The Nasdaq composite and small-cap Russell 2000 jumped 2.6%.

Initial jobless claims rose slightly more than expected in the week ended Dec. 24, but remain low at 225,000. Continuing claims climbed 41,000 to 1.71 million in the latest week, the highest since early February.

AAPL stock popped 2.8% to 129.61 after skidding 3.1% Wednesday to a bear-market low. Apple iPhone production is rebounding, according to The Wall Street Journal, following yet another report of recent iPhone output woes.

U.S. crude oil prices dipped 0.7% to $78.40 a barrel.

The 10-year Treasury yield fell 5 basis points to 3.83%.

ETFs

Among the best ETFs, Innovator IBD 50 ETF (FFTY) rose 1.1%, while Innovator IBD Breakout Opportunities ETF (BOUT) climbed 0.9%. IShares Expanded Tech-Software Sector ETF (IGV) bounced 3%. VanEck Vectors Semiconductor ETF (SMH) popped 3.3%. Reflecting more-speculative story stocks, ARK Innovation ETF (ARKK) leapt 5.2% and ARK Genomics ETF (ARKG) 4.1%. Tesla stock is a major holding across Ark Invest’s ETFs.

SPDR S&P Metals & Mining ETF (XME) advanced 1.9%. U.S. Global Jets ETF (JETS) ascended 2.65%. SPDR S&P Homebuilders ETF (XHB) climbed 2.4%. The Energy Select SPDR ETF (