Dow Jones Futures: Market Rally Holds Key Levels; Cathie Wood’s new sky-high Tesla price target

Dow Jones futures were little changed after hours, along with S&P 500 futures and Nasdaq futures.

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The stock market rally retreated on Thursday amid earnings reports and weak economic data, although the major indexes held key levels and pared losses somewhat towards the end. Tesla ( TSLA ) sold off as CEO Elon Musk signaled he is willing to see profit margins fall much more after price cuts dented gross margins in the first quarter. At this point, investors should move on while Tesla stock is in the shop.

But Cathie Wood’s Ark Invest remains super bull on Tesla stock, predicting a price of $2,000 in 2027.

Meanwhile, Las Vegas Sands (LVS), Iridium (IRDM) and Lamb Research (LRCX) flashed buy signals on earnings.

early friday, Freeport-McMoRan (FCX), SLB (SLB), Procter & Gamble (PG) and HCA Healthcare (HCA) reports earnings. The FCX share, SLB and P&G are close to buy points, while the HCA share remains in a buy zone.

The LVS share is on the IBD Leaderboard. LRCX stock is on the IBD Big Cap 20.

Dow Jones Futures today

Dow Jones futures fell 0.1% relative to fair value. S&P 500 futures were flat. Nasdaq 100 futures rose 0.1 percent.

Keep in mind that overnight action in Dow futures and elsewhere does not necessarily translate into actual trading in the next regular session.

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Stock market rally

Share price gains saw modest to solid losses, with the major indexes trimming declines in the final minutes.

The Dow Jones Industrial Average fell 0.3% in Thursday’s trading. The S&P 500 index fell 0.6% with Lam Research as a top performer while Tesla shares were Thursday’s worst performers. The Nasdaq composite retreated 0.8%. The small-cap Russell 2000 fell 0.5%.

US crude oil prices fell 2.4% to $77.29 a barrel.

The 10-year government yield gave up 5 basis points to 3.55%.

ETFs

Among growth ETFs, the Innovator IBD 50 ETF ( FFTY ) fell 0.8%, while the Innovator IBD Breakout Opportunities ETF ( BOUT ) fell 0.1%. The iShares Expanded Tech-Software Sector ETF (IGV) returned 0.8%. The VanEck Vectors Semiconductor ETF ( SMH ) was up 0.1%, with LRCX stock a notable holding.

The ARK Innovation ETF ( ARKK ) reflected more speculative stock stocks, falling 3.8% and the ARK Genomics ETF ( ARKG ) retreating 2.9%. Tesla stock is a large holding across Ark Invest’s ETFs.

The SPDR S&P Metals & Mining ETF ( XME ) lost 1.5% and the Global X US Infrastructure Development ETF ( PAVE ) gained 0.2%. The US Global Jets ETF (JETS) fell 1.7%. The SPDR S&P Homebuilders ETF ( XHB ) rose 0.7%. The Energy Select SPDR ETF (XLE) fell 0.9% and the Health Care Select Sector SPDR Fund (XLV) fell 0.4%

The Financial Select SPDR ETF ( XLF ) fell 0.3%. The SPDR S&P Regional Banking ETF ( KRE ) fell 1.9% amid some mixed regional banking results, but that followed Wednesday’s 3.9% jump.

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Tesla shares

Tesla shares plunged 9.75% to 162.99 on Thursday, skimming the lowest to worst levels since late January. Gross margins fell more than expected in the 1st quarter due to several price cuts. The price cuts have continued in April, and Elon Musk said on the Tesla earnings call that he is willing to see margins fall further to increase production.

But put aside what you think about Tesla electric cars or the company.

Right now, TSLA stock looks broken, below all moving averages. If you come across a Tesla stock chart while scrolling through your screens, just hit the space bar and move on for now. If you want, set an early warning so if TSLA starts to recover, you’ll have an eye on it.

Cathie Wood’s TSLA Price Target

Meanwhile, Ark Invest, which loves to set sky-high price targets for its investments, says it expects TSLA stock to reach $2,000 in 2027. A year ago, Ark predicted a split-adjusted TSLA price of $1,533 in 2026. Cathie Wood’s Ark sees Tesla sells between 10.3 million and 20.7 million, with massive revenues from autonomous driving.

Ark Invest has consistently predicted EV sales far in excess of actual results, as well as making bold, Musk-esque forecasts for self-driving cars and robot axes that have yet to materialize.

Shares in buying zones

Las Vegas Sands posted strong first quarter results with more than doubling revenue as the end of Covid restrictions fueled a Macau boom. LVS shares rose 3.7% to 61.53, breaking past a 60.40 cup handle buy point. Wynn Resorts (WYNN) and MGM Resorts (MGM) flashed buy signals Thursday but cut or erased gains. Melco Resorts (MLCO) broke out.

Iridium reported a 300% EPS increase in Q1, while revenue also peaked. IRDM shares rose 11% to 65.03, briefly breaking past a buy point at 65.51, according to MarketSmith. Better contributions may have come earlier in the session, when Iridium broke a downtrend and cleared some short-term levels. IRDM stock is technically usable here, but feels somewhat extended from the 50-day line. Stocks have had a recent history of rising for a couple of days and then pulling back, forging another consolidation. Investors may want to see if Iridium stalls near highs for a few days.

Lam Research reported mixed results and weak guidance, but investors may have feared far worse. Also, Taiwan Semiconductor (TSM) did not cut investment plans Thursday, despite reports that the chip casting giant may do so. LRCX stock jumped 7.2% to 526.52, rebounding above the 50-day line and breaking a downtrend line. Shares managed short-term resistance around 533. LRCX stock still has a buy point at 548.95 with a flat base.

Market rally analysis

The stock market rally lost ground on Thursday. The Nasdaq was close to testing its 21-day line and the 12,000 level, but held those levels for now. The S&P 500 and Dow Jones are still above their 21-day lines.

Going back, the major indexes continue to trade tightly in a range. They are all roughly midway between the 2023 highs and the 50-day moving average.

Tesla stock was a notable mover on the S&P 500 and the Nasdaq Composite. The EV giant’s earnings and Musk’s comments triggered heavy losses in the auto sector.

But sales were widespread. The losers significantly outnumbered the winners on Thursday.

The housebuilders were strong on DR Horton (DHI) earnings, while gaming stocks were winners thanks to Las Vegas Sands. Taiwan Semiconductor and Lam Research gave a boost to some chip equipment giants, but many chip names were lacking or delayed. Medical products are leading, although many gave up ground on Thursday.

Earnings and guidance dominate the headlines, but recession signals are growing.

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What to do now

If the market rally takes off, with the major indexes and leading stocks gaining ground amid sustained market breadth, buying opportunities will be plentiful. But that’s not the case right now.

While the indices have been relatively tight, there has been more volatility for different sectors or individual stocks.

Some stocks flashing buy signals work, others work for a few days or a few hours.

Exposure should be modest, with your specific level largely dependent on the stocks you hold.

Earnings season is set to add to the uncertainty, with megacaps next week leading hundreds of reports. The market can make a “decisive” move higher or lower – and then reverse course the next day.

Stay engaged and flexible. Have your watch lists and exit plans ready.

Read The Big Picture every day to stay in sync with market direction and leading stocks and sectors.

Follow Ed Carson on Twitter at @IBD_ECarson for stock exchange updates and more.

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