Dow Futures Rise: Microsoft Leads New Buying, SEC Approves Bitcoin ETFs; Inflation report due

Dow Jones futures were little changed overnight, along with S&P 500 futures and Nasdaq futures, with the release of the CPI inflation report. The Securities and Exchange Commission (SEC) has finally approved the creation of spot Bitcoin mutual funds. KB Home (KBH) Reported profits.

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The stock market rally saw modest gains on Wednesday, with major indexes heading back toward 52-week highs.

Microsoft (MSFT), Service now (now), a work day (day), Mercadolibre (Millie) And Homet Space (Home) All buy signals are flashing on Wednesday.

MSFT stock is close to surpassing the market cap of fellow Dow Jones apple (Camel).

Microsoft and NOW Stock are on Bahraini dinar 50. Microsoft and MELI stock are on the move swingtrader. MSFT stock is on IBD's list of long-term leaders. ServiceNow, Microsoft, MercadoLibre, and WDAY stock are available at Bahraini dinar 50. Workday, ServiceNow, and MELI stock available at IBD Big Cap 20. Microsoft was the IBD stock of the day on Wednesday.

The video embedded in the article discusses market action and analyzes Microsoft, ServiceNow, and GigaCloud technology (Jct).

SEC approves spot Bitcoin ETFs

The Securities and Exchange Commission approved rule changes Wednesday afternoon, allowing Bitcoin exchange-traded funds.

In total, 11 spot bitcoin ETFs will begin trading on Thursday.

During Wednesday's session. CBOE Global Markets (Kabwe) approved six bitcoin ETFs to begin trading on Thursday. Specifically, the ETF is the Invesco Galaxy Bitcoin ETF (Petco), Franklin Bitcoin ETF (Izbek), ARK 21Shares Bitcoin ETF (ARKB), Van Eck Bitcoin Trust (Hodel), Fidelity Wise Origin Bitcoin Fund (FBTC), and WisdomTree Bitcoin Fund (BTCW).

Spot ETFs are seen to attract a lot of institutional support for Bitcoin.

On Wednesday, Bitcoin price rose to $45,954.49 as of 5 PM ET. The cryptocurrency reached $47,696.61 on Wednesday afternoon before falling to around $46,500.

Cryptocurrency exchange Coinbase (currency) and bitcoin mine Digital Marathon (Mara) rose strongly after hours. Both lost a small portion in Wednesday's session.

Dow jones futures today

Dow Jones futures rose 0.1% versus fair value. S&P 500 futures rose 0.1%. Nasdaq 100 futures rose 0.3%.

The Labor Department will release the Consumer Price Index for December at 8:30 a.m. EST, as well as weekly unemployment claims. The CPI report is sure to move Dow futures and Treasury yields.

Remember, an overnight move in Dow Jones futures and elsewhere does not necessarily translate into actual trading in the next regular stock market session.

KB Home Earnings

KBH stock fell modestly in late trading after KB Home's earnings and revenue beat modestly. Shares rose 1.1% to 63.20 in Wednesday's session, briefly hitting their best levels in nearly 17 years. Home stocks rose in late 2023 as mortgage rates fell. Many investors liquidated short positions on Wednesday.

Consumer Price Index Inflation Report

Economists expect the December CPI to rise by 0.2% compared to November, with the annual CPI inflation rate rising to 3.2%. Core CPI is expected to rise 0.2% during the month, with core inflation falling to 3.8% from 4%. This would be the lowest level since May 2021.

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Stock market pool

The stock market rally showed modest gains on major indexes, which closed near session highs. The Dow Jones Industrial Average rose 0.45% in stock market trading on Wednesday. The Standard & Poor's 500 rose 0.6%. The Nasdaq Composite Index advanced 0.75%.

After a brief pullback to start 2024, the S&P 500 is just below recent highs and is approaching its record highs set in January 2022. The Nasdaq is nearing the 15,000 level, with a two-year high just above that. The Dow Jones Index is hovering below its all-time high on January 2.

The small-cap Russell 2000 rose 0.1%, holding its 21-day streak.

Much of the major indices' gains reflected giant technology stocks such as MSFT and ServiceNow. Nvidia (NVDA) And Meta platforms (dead).

Invesco S&P 500 Equal Weight Fund (RSP) and the First Trust Nasdaq 100 Equal Weighted Index ETF (QQEWBoth rose 0.2%.

Overall, winners outperformed losers slightly on Wednesday, but market breadth has been fairly weak in 2024. However, investors had no trouble this week finding a slew of blue-chip stocks flashing buy signals from a variety of sectors.

US crude oil prices fell by 1.2% to $71.37 per barrel.

The yield on the 10-year Treasury note rose one basis point to 4.03%.

ETFs

Among the growth ETFs is the iShares Expanded Technology Software Sector ETF (IGV) by 1.4%. Microsoft stock is a huge component of the IGV, with notable holdings of ServiceNow and Workday as well. VanEck Vectors Semiconductor ETF (Trait) increased by 0.1%

Reflecting more speculative stocks, the ARK Innovation ETF (Ark(down 0.3% and ARK Genomics ETF)ARCJ) decreased by 0.6%. COIN stock is the #1 stock in Ark Invest's ETFs.

SPDR S&P Metals and Mining Fund (XME) fell 0.9% and the Global X US Infrastructure Development ETF (cradle) by 0.5%. US Global Jets ETF (Planes) by 0.3%. SPDR S&P Homebuilders ETF (XHB) rose 1%. Energy Select SPDR ETF (XLE(A decline of 1%, while the SPDR Fund for the Healthcare Sector declined)Forty-fifth) rose by 0.5%.

Selected Industrial Sector SPDR Fund (forty-first(0.5% and the Financial Select SPDR ETF)XLF) increased by 0.2%.

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Microsoft flash drives buy signal

Microsoft stock rose 1.9% to 382.77, moving toward a buy point at 384.30 from a flat base pattern. But stocks gave three reasons for early entry. MSFT stock has decisively cleared the sloping trend line. It has moved above several weeks of tight trading resistance near 377. It has extended its rebound from the 50-day and 10-week lines, while remaining close.

Microsoft is right on the heels of Apple for the title of most valuable company. Its market value now stands at $2.845 trillion. This is slightly less than Apple's stock of $2.895 trillion.

So far in 2024, MSFT stock is up 1.8%. Apple shares fell 3.3%, with shares rising 0.6% on Wednesday. Three analysts have downgraded AAPL stock this year, mostly due to concerns about the iPhone.

Apple's sales have declined for four straight quarters. Microsoft's earnings and sales growth have been slowly accelerating over the past three quarters. Wall Street expects Microsoft's growth to outpace Apple's, led by artificial intelligence.

Other stocks are in buy zones

NOW stock rose 2.2% to 714.30, extending its rebound from its 10-week streak. Stocks traded with a downward sloping trend line. ServiceNow stock has a four-week tight pattern with a 720.68 entry, formed below the 20%-25% profit-taking zone. But NOW stock is on track to form a flat base with that buy point after this week. Investors should note that ServiceNow's earnings are due on January 24th.

WDAY stock rose 0.4% to 276.81, breaking the trend line in a short consolidation, providing an early entry. Business Day rebounded this week from just above the 10-week line, albeit on mild volume. Shares have a 279.83 entry of a tight four-week pattern that will be a flat base after Friday if WDAY stays in its range.

MELI stock advanced 1.6% to 1,598.16, moving away from its 21-day line after bouncing from the 50-day line last Friday. The MercadoLibre has a flat base that is part of a base formation on the base, with a buy point of 1,660. Investors could have used Monday's move above the 21-day as an entry point, as Wednesday provided a narrow entry to the trend line.

Howmet Aerospace stock rose 3.5% to 55.57, surpassing the entry level of 54.53 and continuing this week's rebound from the 10-week line. The 54.53 buy point is off the shelf – technically for four weeks – formed around the top of the previous buy zone.

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What are you doing now

The overall picture is bullish and investors should look for ways to add exposure gradually. A few stocks flashed buy signals on Wednesday, including Microsoft, but a number of them were already extended. So don't chase those names.

Also think about diversifying your investment portfolio.

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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