Dow Jones futures rose slightly Friday morning, along with S&P 500 futures and Nasdaq futures, with the stock market rally eyeing fresh highs. Bitcoin continued its strong run, flirting with 22-month highs, as crypto-related stocks soared.
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Affirm (AFRM), Expedia (EXPE), Cloudflare (NET) and Pinterest (PINS) were big earnings movers overnight.
The stock market rally continued to advance Thursday. The major indexes edged higher, with the S&P 500 briefly brushing above 5,000, while small caps ran. AI plays led the way once again, with Monolithic Power Systems (MPWR) and especially Arm Holdings (ARM) becoming the latest to gap up powerfully on earnings.
AI software plays Samsara (IOT), Braze (BRZE) and UiPath (PATH) flashed buy signals Thursday. PATH stock is a major holding for Cathie Wood’s ARK Invest.
Arm stock is on IBD Leaderboard, with Expedia on the Leaderboard watchlist. Monolithic Power stock is on the IBD Long-Term Leaders watchlist. Braze, Arm, Samsara and Cloudflare stock are on the IBD 50. Pinterest stock is on the IBD Big Cap 20.
Samara was Thursday’s IBD Stock Of The Day.
Dow Futures Today
Dow Jones futures edged higher vs. fair value. S&P 500 futures climbed 0.1% and Nasdaq 100 futures rose 0.3%.
At 8:30 a.m. ET, the Labor Department will release consumer price index revisions. That will show if the recent disinflation trend is stronger or weaker than previously reported.
Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.
Bitcoin Price
Bitcoin jumped to about $47,200 early Friday, up from $45,508.34 on Thursday afternoon and briefly hitting its best levels since at least March 2022. Bitcoin just topped its peaks from early January, as the SEC finally approved spot Bitcoin ETFs.
Bitcoin had already risen 7.4% in the three days ended Thursday.
Marathon Digital (MARA) jumped 9% early Friday. On Thursday, the Bitcoin miner surged 23%, retaking its 50-day line.
Coinbase (COIN) popped more than 5% before the open, signaling a move toward its 50-day line. On Thursday, the cryptocurrency exchange leapt 8.6%.
Earnings
Affirm reported a smaller-than-expected loss with revenue easily beating. Shares fell sharply in Friday’s premarket to around the 50-day moving average. AFRM stock jumped 10% to 49.22 Thursday, extending Wednesday’s move from the 50-day line and above a trendline.
Expedia earnings slightly beat views, but gross bookings were a little light. Also, CEO Peter Kern will step down May 13, with senior exec Ariane Gorin stepping in. Shares sold off had overnight. Expedia rose 3.3% to 159.47 on Thursday, clearing a 155.84 flat-base buy point and continuing this week’s move from the 10-week line.
Pinterest stock fell sharply in extended trade, but well off initial after-hours lows, on weak revenue and guidance. PINS stock edged down 0.3% to 49.72 on Thursday. Last week, the social media site rebounded bullishly from the 10-week line and has held up after Snap (SNAP) crashed on its results.
Cloudflare earnings topped with guidance also solid. Shares skyrocketed late. Cloudflare jumped 8.35% on Thursday to 90.31, clearing an 86.91 buy point from a flat base, base-on-base pattern, as well as extended a move from the 50-day line.
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Stock Market Rally
The Dow Jones Industrial Average rose 0.1% in Thursday’s stock market trading. The S&P 500 index edged up less than 0.1% to 4,997.96, hitting 5,000.40 shortly before the close. The Nasdaq climbed 0.2%, moving toward the 16,000 level and all-time highs.
Market breadth was strong. The small-cap Russell 2000 leapt 1.5%, rebounding from the 50-day line and back above the 21-day.
Clearly the market is rewarding AI plays. In addition to strong earnings and guidance from the likes of Arm, there are strong capital spending plans and hints from Microsoft (MSFT), Google parent Alphabet (GOOGL), Meta Platforms (META) and Amazon.com (AMZN).
But industrials, housing, infrastructure and travel sectors are all doing well, with some medical and financial names showing strength.
Still, not many stocks are actionable right now. Some are flashing buy signals right into earnings, including Affirm, Cloudflare and Expedia. But, as Thursday night’s earnings reactions showed, buying just before results is hit or miss.
The Nasdaq composite is 5.7% above its 50-day line, slightly extended.
U.S. crude oil prices jumped 3.2% to $76.22 a barrel.
The 10-year Treasury yield popped 7 basis points to 4.17%, just below 2024 highs.
ETFs
Among growth ETFs, the iShares Expanded Tech-Software Sector ETF (IGV) rose 1% and the VanEck Vectors Semiconductor ETF (SMH) 1.4%, both to fresh highs. IOT stock, Braze and Monolithic Power are IGV holdings, with Monolithic Power in the SMH ETF.
The SPDR S&P Homebuilders ETF (XHB) climbed 1.7% and the Global X U.S. Infrastructure Development ETF (PAVE) 0.7%, also both to new highs. The Industrial Select Sector SPDR Fund (XLI) closed fractionally higher, matching Wednesday’s all-time high intraday.
Reflecting more-speculative story stocks, ARK Innovation ETF (ARKK) popped 2.7% and ARK Genomics ETF (ARKG) 2.8%. UiPath is a top-five holding in ARKK and in Cathie Wood’s ARK Invest ETFs overall.
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ARM Stock
Arm stock skyrocketed 48% to 113.89 in massive volume, on strong earnings and guidance. Shares hit 126.59 intraday. The wireless chip design giant sees strong AI-related growth. Investors could have bought the earnings gap-up. Now, they could wait to see if Arm holds gains for a few days or weeks. Existing holders have to decide whether to stand pat for now or to take at least partial profits.
Monolithic Power stock leapt 14% to 737.07 from better-than-expected earnings and guidance. The data-center chipmaker is at least benefiting from being associated with the AI boom with partnerships with Nvidia (NVDA) and others. MPWR stock decisively cleared a 647.12 buy point from a base-on-base formation, according to MarketSmith analysis.
AI Stocks Flashing Buy Signals
Samsara stock jumped 5.9% to 43.31, decisively clearing the 50-day line. Shares also topped or tested a trendline, depending on how tightly that’s drawn. Those offered early entries into the AI-themed Internet of Things play, with 35.18 another trigger point. Samara stock has a 36.91 buy point from a consolidation around the top of two prior consolidations.
UiPath stock climbed 3.75% to 24.36, rebounding from the 50-day line, breaking a trendline and, intraday, topping a short-term high of 24.40. All those offered reasons for an early entry. The automation software maker, a longtime Cathie Wood holding, has a 26.52 official buy point.
Braze stock climbed 4% to 58.62, clearing a 57.59 handle buy point in a base-on-base formation. The customer-relationship platform has an AI-powered chatbot.
What To Do Now
The stock market rally continues to act well, but it’s mostly a time to be riding the wave. Limited buying opportunities and a somewhat-extended Nasdaq offer reasons to be cautious about adding new buys. You could choose to take some profits in stocks that you have less conviction in or that are now overweight.
Have your game plan ready for exiting positions, or not, in the case of a market pullback or if the market becomes overextended. Keep your watchlists ready to take advantage of new buying opportunities down the road.
Stay engaged and remember to be flexible and patient.
Read The Big Picture every day to stay in sync with the market direction and leading stocks and sectors.
Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.
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