Dow Jones Futures: Market Rally Not Finished Yet; Tesla Shanghai Production

Dow Jones futures will open on Monday evening, along with S&P 500 futures and Nasdaq futures, after the long Christmas weekend. Tesla Shanghai halted production while China rival Nio (NIO) unveiled new models.

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The stock market rally had another difficult week, but did bounce from Thursday’s lows. The major indexes were mixed last week, but many leading stocks came under further pressure. The market rally is looking shaky but isn’t finished yet.

It’s not a good time to be buying stocks, especially growth names. But investors should always be looking for potential growth leaders for the next sustained market rally. Shift4Payments (FOUR), Celsius (CELH), Impinj (PI), Enphase Energy (ENPH) and Box (BOX) are holding up relatively well in the current weak market. FOUR stock and Box are consolidating near recent highs, while Impinj, Celsius and ENPH stock are trading around the 50-day or 10-week lines. None are actionable right now, and all could buckle if the market continues to weaken. But keep an eye on them.

ENPH stock is on IBD Leaderboard, with PI stock on the Leaderboard watchlist. Enphase, Shift4Payments, Box and CELH stock are on the IBD 50. ENPH stock also is on the IBD Big Cap 20. Shift4Payments was Friday’s IBD Stock Of The Day.

But growth megacaps had a rough outing, notably Apple (AAPL), Nvidia (NVDA) and Tesla (TSLA).

Nio Day 2022

Finally, Tesla China rival Nio (NIO) is holding its Nio Day 2022 on Saturday. It unveiled the EC7 coupe SUV, a likely Tesla Model Y competitor on the high end. EC7 deliveries will start in May 2023. Nio also unveiled a revamped ES8 SUV, now on the NT 2.0 platform like its all-new models. Deliveries begin in June.

Nio also announced next-generation battery swap stations and charging options.

Nio production is ramping up with strong demand for its newer ET5 sedan and ES7 crossover SUV. But easing Covid rules may be triggering a massive wave of infections, and Nio and other China EV makers could face production or supply-chain hiccups again. EV giant BYD (BYDDF) said this week that Covid cases among workers is cutting production by 2,000-3,000 vehicles per day.

Nio stock fell 5.4% last week, back below the 50-day line. Shares are well below the 200-day line.

Tesla Shanghai Production Halted

Tesla Shanghai halted production on Dec. 24, with workers set to return Jan. 1, 2023. A year-end production halt had been widely reported in recent weeks, but denied by the EV giant. Shanghai had already slowed output earlier in the month, with inventories building up rapidly despite a late October price cut and substantial year-end incentives.

Last week, Tesla stock dived 18% to 123.15 after plunging 16.1% in the prior week. Those are the worst weekly losses since the March 2020 Covid crash. TSLA stock is at a 27-month low, down 70% from the November 2021 peak.

Dow Jones Futures Today

With Christmas falling on Sunday, U.S. stock and bond markets will be closed Monday, along with many exchanges around the world.

Dow Jones futures open at 6 p.m. ET on Monday, along with S&P 500 futures and Nasdaq 100 futures.

Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.

Join IBD experts as they analyze actionable stocks in the stock market rally on IBD Live

Stock Market Rally

The stock market rally fell solidly during the week, but did finish off the worst levels of the week.

The Dow Jones Industrial Average rose 0.9% in last week’s stock market trading. The S&P 500 index dipped 0.2%. The Nasdaq composite sank 1.9%. The small-cap Russell 2000 finished just above break-even.

Apple stock fell 2% to 131.86 in the past week. It’s testing its June bear-market low of 129.04, sliding to 129.64 Friday morning.

Nvidia stock tumbled 8.2% to 152.06, following a nasty reversal back below the 200-day line in the prior week, amid a broad chip sell-off. NVDA stock did find support at the 50-day line on Friday.

The 10-year Treasury yield jumped 27 basis points to 3.75%. The inverse relationship between Treasury yields and stock prices has faded in the past several weeks.

U.S. crude oil futures jumped 6.9% to $79.56 a barrel during the week, briefly topping $80 on Friday.

Tesla Buckles Up For A Very Interesting 2023

ETFs

Among the best ETFs, the Innovator IBD 50 ETF (FFTY) edged down 0.3% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) rose 0.7%. The iShares Expanded Tech-Software Sector ETF (IGV) fell 1.8%. The VanEck Vectors Semiconductor ETF (SMH) tumbled 4.7%, with NVDA stock a major SMH holding.

SPDR S&P Metals & Mining ETF (XME) rose 1.6% last week. The Global X U.S. Infrastructure Development ETF (PAVE) edged up 0.75%. U.S. Global Jets ETF (JETS) descended 1.3%. SPDR S&P Homebuilders ETF (XHB) declined 1.25%. The Energy Select SPDR ETF (XLE) bounced 3.2% and the Financial Select SPDR ETF (XLF) edged up 0.8%. The Health Care Select Sector SPDR Fund (XLV) nudged…