Dow Jones Futures: Why Shares Rise in Big Fed Rate Rise; What to do now

Dow Jones futures soared overnight with S&P 500 futures and Nasdaq futures. The stock market fluctuated on Wednesday after the Federal Reserve raised interest rates the most since 1994, but soared as Fed President Jerome Powell signaled at a Fed meeting in late July that policymakers might raise rates slightly.


Treasury yields fell sharply on Wednesday after rising to a multi-year high on Tuesday.

Enface energy (ENPH), Harmony Biosciences (HRMY), Automation (A), Ulta beauty (Ulta) And Onsemi (Ann) Five stocks to watch. All are integrated, keeping their 50-day moving average above or near Relative strength lines Max or near.

Ann is in stock IBD Leaderboard Monitoring List. There are AN stock and Harmony Biosciences IBD 50. AutoNation is Wednesday IBD Day Stock.

Tesla (DSLA) The National Highway Traffic Safety Administration recovered solidly on Wednesday, despite reports that the EV giant dominates accidents involving driver-assisted systems.

Dow Jones Futures Today

Dow Jones futures rose a reasonable value against 0.8%. The S&P 500 futures were up 0.9% and the Nasdaq 100 futures were up 0.95%.

The 10-year Treasury yield fell 6 basis points to 3.33%, extending Wednesday’s losses. The two-year yield is down 4 basis points to 3.24%.

Crude oil prices rose 1% in the United States.

Bitcoin traded above $ 22,000 on Wednesday evening after hitting a new 18-month low of $ 20,087.90 earlier this week.

Remember that action is overnight Dove futures Elsewhere there is no need to translate it into the next regular real trade stock market Session.

Ooty meeting

Policy classifiers Voted to raise fees 75 basis points for the first time since 1994, at the end of a two-day Fed meeting, to the 1.5% -1.75% range.

This came after the May 10 consumer price index showed that inflation had risen unexpectedly to 8.6% in 40 years.

Powell, the central bank’s chairman, told a news conference after the policy meeting that the central bank was raising rates “quickly” and deciding on “front load” increases. “Inflation is very high,” he said, as labor markets tightened.

But Powell said the Fed could raise rates by 50 or 75 basis points at a Fed meeting in late July. He also stressed that the policy would be “sensitive and flexible”. Prior to those comments, markets were fully priced at 75 basis points at next month’s meeting. CME FedWatch Tool. Markets still see a 70% chance of a three-quarter point move by the end of July.

All central bank executives see rates rise to at least 3% by the end of the year, with an average rating of 3.4%. They see 3.8% by the end of 2023.

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According to the Per capita Consumption Price Index, the central bank is currently seeing 5.2% inflation this year. It was 4.3% in March and 2.6% last December.

Policymakers expect their preferred inflation index, the Core PCE Index, to ease to a further 4.3% gain in the fourth quarter and fall to 2.7% by the end of 2023.

The Federal Reserve and Fed President Powell sought to strike a subtle balance on Wednesday. On the one hand, they wanted to take a big step against inflation and regain lost credibility. Powell, on the other hand, and his fellow policymakers did not want to crush the economy. There was a surprising drop in retail sales on Wednesday with several weak economic statements.

The Fed beat Wall Street at least one afternoon. As key indicators fell mixed after the federal rate hike and Powell began to speak, the intraday high rose as a “flexible” Fed leader opened up the possibility of a half-point move. The stocks closed at their best levels, but still rose solidly or sharply.

Treasury revenues fell sharply in Powell’s 50- or -75s, especially at two-year yields.

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Stock Market Wednesday

The stock market faltered after the announcement of the rate hike, but Powell’s comments continued to recover.

The Dow Jones Industrial Average rose 1% on Wednesday Stock market trading. The S&P 500 index was up 1.5%. Nasdaq compound rose 2.5%. Small-cap Russell 2000 advanced 1.5%.

10-year Treasury revenue fell 9 basis points to 3.39%. Two-year yields are closely linked to central bank rate movements, falling 15 basis points to 3.28%.

US crude was down 3% at $ 115.31 a barrel. Natural gas prices rose moderately after falling 16% on Tuesday.

In the middle The best ETFsInnovator IBD 50 ETF (FFTY) Closed unchanged, while Innovator IBD Breakout Opportunities ETF (BoatDecreased by 0.2%. iShares Extended Technology-Software Industry ETF (VAT2.65%. WANEX Vectors Semiconductor EDF (SMH) Advanced 1.8%.

SPDR S&P Metals & Mining ETF (XME) 2.1% up and Global X US Infrastructure Development ETF (Pavement0.8%. US Global Jets ETF (JETS) 1.55% higher. SPDR S&P Homebuilders ETF (XHB0.3% higher. Energy Selection SPDR ETF (XLE) Fell 2.2% and Financial Select SPDR ETF (XLF) Received 1.1%. Health Care Selected Sector SPDR Funding (XLV) Moved more than 1%.

Represents more speculative story stocks, ARK Innovation ETF (ARKK) 6.6% higher and ARK Genomics ETF (ARKG) Tesla tops the list with 5.2% Arc Investment ETFs.

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Stocks to watch

ENPH stock rose 5% to 188.48 on Wednesday, recovering from its 50-day and 200-day taxes. Manufacturer of Solar Power Inverters a Double base Within a large integration on June 2nd. Enface shares rose for a few days and then fell. 193 input is no longer valid. ENPH stock has created a handle Buy point 217.33, slightly above the June 8 intraday high.

HRMY shares rose 0.3% to 44.61, moving its 50-day line, but down intraday gains. Harmony is Biosciences File Basic 54.10 with entry. But it still takes a day to build a handle, lowering the buying point to 47.21.

AutoNation shares were down 1.45% at 113.40 on Wednesday, closing slightly below its 50-day and 200-day lines. AN stock is in long-term consolidation with a buy point of 133.58. But investors can use resistance above 126 as an initial entry. Last Friday, the used car dealer hit 126.14 in intraday, up 126.39 in early May, and then fell to a low.

Ulta Beauty stock rose 3.3% to 405.61, regaining its 50-day high after finding support in the 200-day range earlier this week. Shares of ULTA were flat last week with a buying point at 426.93 cup-with-hands, before falling again. The new handle entry of 429.58 is now playing.

Onsemi stock rose 2.45% to 58.04 on Wednesday, marching from its 50-day and 200-day lines. From late May to early June, ON stock rose from 50-day / 200-day lines to 67.19 on June 8, moving towards the 71.25 consolidation buying point. But the chipmaker fell down again. This has created a somewhat confusing handle with the 67.29 entry. The entrance coincides with a slope-tops Trend.

Tesla stock

Tesla shares rose 5.5% to 699 on Wednesday, below its 21-day tax. On May 24, the stock touched an 11-month low of 620.57.

On Wednesday, the National Highway Traffic Safety Administration reported accidents involving driver-assisted systems. Tesla vehicles using autopilot have been involved in a total of 392 accidents involving 273 accidents from July 20, 2021 to May 21, 2022. One major reason is that there are many Tesla EVs on the road using autopilot.

Tesla has long claimed that automated pilot enhances safety, but does not use Apple-to-Apple comparisons based on road type, weather, and more. NHTSA recently expanded its autopilot study, while also researching “Phantom Braking” on Tesla vehicles.

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Separately, CEO Elon Musk tweeted Wednesday that he is leaning in favor of GOP Florida Governor Ron Desantis as president in 2024.

On Thursday, Musk will host a town hall Twitter (TWTR) Addressed employees for the first time since reaching a $ 54.20-a-share deal for the social platform in late April, reaching $ 44 billion. Musk, who has shaken up the right diligence rights, has since complained about fake accounts on Twitter. Musk may want to pull out of the deal or significantly reduce the price.

Twitter shares rose 2.1% to 37.99 on Wednesday.

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Market analysis

The stock market ended higher on Wednesday after the central bank raised interest rates and Powell’s comments.

Attempts to bolster the stock market are currently underway. Wednesday marked the second day of Nasdaq’s rally effort, following the rise in technology-heavy indices on Tuesday. But the rally attempt is not a green light.

After sharp losses in recent days, key indices are well below their 10-day moving average, and let’s put considerable resistance aside.

Still, investors should be looking for one soon The following day To confirm the new load. Stabilized market rallies do not always work, however, 2022 has shown.

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What to do now

Wednesday’s action was positive, but a good day did not make sense, especially at the bear market.

If there is a consecutive day, investors can enter the market and slowly add exposure as conditions begin to improve.

In the meantime, be vigilant and prepared. Create watch lists of potential leaders.

Enface, OnSemi and other stocks to watch fought on the absolute basis, despite their strong relative strength. There is no guarantee that these names will be relatively good, or that they will lead to the next real hike.

According to The big picture Every day the direction of the market and the leading stocks and sectors must be consistent.

Follow Ed Carson on Twitter @IBD_ECarson For stock market updates and more.

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