Dow Jones Futures: Tesla Pops On Bullish Elon Musk; Market Rally

Dow Jones futures were little changed after hours, along with S&P 500 futures and Nasdaq futures, as Tesla (TSLA) rose late 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) and IBM (IBM) also reported, with Teradyne (TER) on tap tonight as well.

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

Dow Jones Futures Today

Dow Jones futures edged lower vs. fair value, with CVX stock and IBM both blue chips. S&P 500 futures were flat and Nasdaq 100 futures rose 0.1%. Tesla stock, LRCX, NOW and STLD stock are S&P 500 and Nasdaq 100 stalwarts.

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.

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. 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 deliveries 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.

Musk said Cybertruck output will begin by the summer, but “volume production” may not happen until 2024. Tesla will provide further details about an upcoming vehicle at its March 1 investor day. That could be a smaller, cheaper EV.  That could open up a big new market for Tesla, including in new markets, but would face a large number of existing rivals.

Late Tuesday, Tesla said it would…