Dow Jones futures will open on Sunday evening, along with S&P 500 futures and Nasdaq futures.
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The stock market rose over the week thanks to Nvidia (NVDA) Earnings and guidance lift AI plays. The S&P 500 and Dow Jones indexes hit record highs while the Nasdaq Composite is close to that. Nvidia itself has soared, achieving yet another milestone.
Advanced micro devices (AMD), Lennar (flexible), Manhattan Associates (Manh), Microsoft (MSFT) And MongoDB (MDB) Are the shares prepared or potentially exercisable. AMD, MongoDB and Microsoft stocks are AI plays.
However, investors should be cautious about new purchases, especially with AI stocks now. The market rally is about to expand, even with Friday's pause. Many of the hottest stocks, including Nvidia, are significantly extended. A longer pause or pullback in the stock market may be constructive.
Nvidia stock is on IBD Leaderboard. Microsoft stock is on SwingTrader and IBD Long-Term Leaders. Nvidia, Microsoft, and MongoDB are on board Bahraini dinar 50. Shares of Nvidia, MongoDB, AMD, and Manhattan Associates are in the market IBD Big Cap 20.
The video embedded in this article discusses the big market week and analyzes Lennar, Manhattan Associates, and AMD stocks
Berkshire Hathaway earnings
Berkshire Hathaway (I ride) is scheduled to report fourth-quarter earnings on Saturday morning. The group is expected to report operating earnings of $3.81 per share, an increase of 24.5% compared to the previous year.
Berkshire will also disclose its net stock purchases or sales, the size of its cash hoard, as well as its stock repurchases.
Investors should also get Warren Buffett's annual letter to shareholders, where he will offer his thoughts on the economy and investing.
Berkshire Hathaway Class B shares rose 2.8% to 417.22 last week, a new high and the sixth straight weekly gain.
Dow jones futures today
Dow Jones futures open at 6pm EST on Sunday, along with S&P 500 futures and Nasdaq 100 futures.
Remember, an overnight move in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.
Join IBD experts as they analyze leading stocks and the market on IBD Live
Stock market pool
The stock market rally extended the decline to start the week but is back on track with Nvidia.
The Dow Jones Industrial Average rose 1.3% in stock market trading last week, while the S&P 500 jumped 1.7%, both hitting all-time highs. The Nasdaq Composite rose 1.4%, reaching a two-year high but closing below 16,000 on Friday. It is also just below its late 2021 peak.
The Russell 2000 small-cap index fell 0.8%, still in range from the end of last year.
All of these indices rebounded from their 21-day exponential moving averages.
Invesco S&P 500 Equal Weight Fund (RSP) rose 1.2% to a record high. The First Trust Nasdaq 100 Equal Weighted Index ETF (QQEW) advanced by 0.7%, heading towards a new high.
This confirms that market leadership is relatively broad, extending beyond the AI and technology names.
However, the Nasdaq rose 4.9% above its 50-day line and the S&P 500 rose 5%. This is about to be extended again. Certainly, the indicators could expand further, but the risk of a pullback will increase.
The market rally has been reluctant to stop for long, only making short tests of the 21-day line. But whenever the Nasdaq rebounds quickly, it extends again within a day or two.
So it is not surprising that bullish sentiment is high. the Read Bulls vs Bears It has reached multi-year highs, just below extreme levels, even before hitting new highs this week.
The 10-year Treasury yield fell 4 basis points to 4.26% during the week, down 7 basis points on Friday from a three-month high.
US crude oil futures fell 2.5% to $76.49 per barrel during the week, thanks to Friday's 2.7% drop.
ETFs
Among the growth ETFs is the iShares Expanded Technology Software Sector ETF (IGV(1%), but it reduced its weekly losses after declining on Wednesday Palo Alto Networks (Bano). MSFT stock is a major component of the IGV with Manhattan Associates also in the ETF. VanEck Vectors Semiconductor ETF (Trait) jumped 3.4% to a record high. Nvidia and AMD are huge SMH holdings.
SPDR S&P Metals and Mining Fund (XME) fell nearly 1% last week. Global X US Infrastructure Development Foundation (ETF)cradle) by 1.9% to a new high, extending its winning streak to seven weeks. US Global Jets ETF (Planes) rose by 0.75%. SPDR S&P Homebuilders ETF (XHB) jumped 3% to a record high, with LEN stock holding. Energy Select SPDR ETF (XLE) rose by 0.5%.
Healthcare Select Sector SPDR Fund (Forty-fifth(1.5% and SPDR Industrial Sector Fund)forty-first) advanced 1.9%, both reaching record levels.
Financial Select SPDR ETF (XLF) by 1.6% to the best level in two years. Berkshire Hathaway is the No. 1 holding company in XLF.
Reflecting more speculative stocks, the ARK Innovation ETF (Ark) fell 3.8% last week and the ARK Genomics ETF (Arkj) lost 4%.
Time the market with IBD's ETF market strategy
Nvidia stock
Nvidia stock rose 8.5% to 788.17. This was all due to Thursday's 16.4% surge in another quarter of earnings and higher guidance, rising from the 21-day line to a new record high.
Nvidia is easily the best-performing stock in the S&P 500 this year, having led the way in 2023. It ended the week with a valuation of $1.946 trillion, and briefly surpassed $2 trillion on Friday. It is now the third most valuable American company. It is increasingly plausible to see Nvidia stock topping the market cap of apple (Camel) ($2.818 trillion) and even Microsoft ($3.049 trillion).
However, NVDA stock is now 33% above its 50-day moving average. It may take some time before the AI leader presents a buying opportunity.
Stocks to watch
AMD stock rose 1.5% to 176.52, but it's been a wild week. Shares fell back to the 10-week line, undercutting several weeks of trading, then rose nearly 11% Thursday on Nvidia's earnings before pulling back somewhat on Friday. AMD stock is actually up 1.52% on the week, which is quite a lot for a three-week stock with a buy point of 183.83. Investors may want to wait another week for a flat base to form. This would also give more time for the 10-week streak to catch up.
One question for investors: Why buy AMD — or any other AI stock — instead of waiting for an opportunity to buy or add to Nvidia, the clear leader in AI?
Microsoft stock rose 1.55% to 410.34 last week, rebounding from a 10-week streak and reclaiming a 21-day streak, providing a new entry for the AI and cloud giant.
MongoDB stock fell below the 422.84 buy point on Wednesday, but found support at the 10-week line, and rebounded on Thursday and Friday to reclaim the buy zone. However, shares fell 2.9% to 451.32.
Lennar stock rebounded from its 50-day line, rising 3.2% to 155.08, just below a flat buy point of 156.01.
Manhattan Associates shares consolidated this month after breaking out of a flat base on Jan. 31 after earnings. The supply chain management software maker tested its 21-day streak on Wednesday and then rebounded, closing up 2.1% to 248.90 during the week. Stocks have cleared a short, downward-sloping trend line, providing a solid entry. Investors can also wait for a move above the 251-252 areas, to clear the February trading range.
What are you doing now
The market rally doesn't want to stop, which is impressive. But this limits new purchasing opportunities. With the Nasdaq and S&P 500 already expanding somewhat, that could be for the better.
Investors will likely want to be cautious about new purchases, especially in high-performing AI operations. There are some non-technical names like Lennar, as well as some consumer, energy and biotech names. This can help diversify AI and technology-heavy portfolios, making them less vulnerable to significant sell-offs.
Cast a wide net to find that broader leadership, and look for actionable names and settings. If you choose to add exposure, you want to have the best names on your watchlists, ready to pounce when buy signals flash.
But don't feel like you have to make too many moves. Riding the current trend with significant exposure is a sound play.
Read The Big Picture every day to stay on top of market trend and leading stocks and sectors.
Please follow Ed Carson on topics at @edcarson1971x/Twitter at @IBD_ECarson And Bluesky V @edcarson.bsky.social For stock market updates and more.
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