Dow Jones futures, S&P 500 futures, and Nasdaq futures will open Sunday evening, with investors closely eyeing the Federal Reserve meeting and AI events from Nvidia and Microsoft in the upcoming week.
The stock market had a mixed week, with the Dow Jones and S&P 500 seeing little change while the Nasdaq and small-cap Russell 2000 retreated below their 21-day lines. Software stocks, initially boosted by strong earnings from Oracle, faced selling pressure on Friday following guidance from Adobe.
In the week ahead, three significant events are scheduled. The Federal Reserve will convene on Tuesday and Wednesday, providing the latest projections for Fed rate cuts on Wednesday afternoon. Nvidia will kick off a four-day GTC Conference on Monday, expected to unveil a new AI chip and other AI-related announcements. Microsoft will host its “New Era Of Work” event on March 21, focusing on AI features and more.
The Fed’s rate outlook will undoubtedly impact financial markets, but the Nvidia and Microsoft events are equally crucial for the AI rally. Following Adobe’s impact on AI software plays, Nvidia and Microsoft’s announcements and partnerships could significantly affect tech companies, including Advanced Micro Devices, Super Micro Computer, Arm Holdings, Arista Networks, ServiceNow, Oracle, Google parent Alphabet, among others.
While Microsoft, Oracle, Google, and ServiceNow stocks presented buying opportunities during the week, they retreated by Friday’s close. Arista Networks is forming a new base, while ARM is in the process of doing so.
Given the current pullback and the anticipation of significant events, investors may choose to hold off on new buys in the very short term.
Nvidia stock, ARM, and ServiceNow are featured on IBD Leaderboard, while Microsoft stock is on the IBD Long-Term Leaders list. Additionally, Nvidia, Arista Networks, ServiceNow, Microsoft, and ARM stock are highlighted on the IBD 50, and Nvidia, NOW, SMCI, and Arista stock are part of the IBD Big Cap 20. Arista Networks was recognized as Friday’s IBD Stock Of The Day.
Dow Jones futures, S&P 500 futures, and Nasdaq 100 futures are set to open Sunday evening, although overnight action doesn’t always translate into actual trading in the next regular stock market session.
The stock market rally experienced a mixed week, with the Dow Jones Industrial Average closing fractionally lower, the S&P 500 index dipping 0.1%, and the Nasdaq composite sinking 0.7%, falling below its 21-day moving average and the 16,000 level. Additionally, the small-cap Russell 2000 sank 2.1% amid poor market breadth.
The market is currently undergoing a pullback or pause, initiated by Nvidia’s downside reversal on March 8. While the Nasdaq has retraced to its February 12 level, the Russell 2000 has fallen below its late December peak, potentially allowing for the formation of new bases and bullish pullbacks.
During the week, the 10-year Treasury yield surged to 4.3%, nearing 2024 highs due to hot inflation reports leading into the Fed meeting. Moreover, U.S. crude oil futures jumped 3.9% to $81.04 a barrel, while copper prices soared 5.9% to the highest close in 11 months due to supply issues.
Looking at ETFs, growth ETFs like the iShares Expanded Tech-Software Sector ETF and the VanEck Vectors Semiconductor ETF experienced mixed performance. Meanwhile, speculative story stocks, represented by ARK Innovation ETF and ARK Genomics ETF, slumped during the week.
The upcoming week holds significant events, including the conclusion of the Federal Reserve’s two-day policy meeting, where policymakers will release their rate forecasts. Nvidia’s four-day GTC conference will commence, featuring announcements related to AI accelerators and other hardware and software. Additionally, Microsoft’s “New Era Of Work” event will discuss AI innovations, Windows updates, and Surface computers.
Investors may choose to hold off on new buys in the very short term due to the ongoing pullback and significant upcoming events. However, it’s crucial to keep watchlists updated and be prepared for potential buying opportunities as the market makes its next move.