Market Rally Stuck At Key Levels, Tesla Extends Slide; Crypto Bank Silvergate Shutting Down

After hours, Dow Jones futures, S&P 500 futures, and Nasdaq futures all tilted higher. Late Wednesday, crypto financial firm Silvergate Capital (SI) announced that it would be shutting down. American Express (AXP) boosted shareholder returns, while MongoDB tumbled on guidance.

The stock market had a mixed session Wednesday, with the major indexes trading around key moving averages.

Chip stocks had a good day, with Nvidia (NVDA), Advanced Micro Devices (AMD), On Semiconductor (ON), Aehr Test Systems (AEHR) and Monolithic Power (MPWR) all doing well. But NVDA stock, AMD, Onsemi and Aehr Test Systems all fell later in the day. MPWR stock is currently working on a cup-with-handle base.

Tesla (TSLA) stocks fell by 10% since the Investor Day on March 1st. This was due to two new safety probes as well as an analyst downgrade.

As the crypto bank plans to shut down, SI stock crashed. Database software maker MongoDB (MDB) reported late Wednesday. In addition, American Express (AXP) announced a new AXP stock buyback and a dividend hike.

The NVDA stock is on the IBD Leaderboard while the MPWR stock is on the IBD 50, Big Cap 20, and the IBD Long-Term Leaders watchlist.

This article's embedded video discusses the market rally's action and analyzes Monolithic Power stock, Oracle (ORCL) and C3.ai (AI).

The Dow Jones Industrial Average (DJIA) is a stock market index that shows how 30 large, publicly owned companies traded during the stock market session.
The Dow Jones Industrial Average (DJIA) is a stock market index that tracks the performance of 30 large, publicly owned companies.

Dow Jones futures rose a fraction compared to fair value. AXP stock provided a small boost to Dow futures. S&P 500 futures and Nasdaq 100 futures climbed 0.1%.

The Labor Department will release the weekly jobless claims data at 8:30 a.m. on Thursday, with the February jobs report due Friday morning.

Overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session, so remember that.

Silvergate Capital, an investment firm, is shutting down.Silvergate Capital, an investment firm, will be shutting down.

decision comes after the company failed to find a buyer for the bank

After hours, Embattled Silvergate Capital said that it will wind down operations and liquidate Silvergate Bank. This decision comes after the company failed to find a buyer for the bank.

The shares of Silvergate have been free falling for the past year as the crypto financial structure buckled. Last week, Silvergate said that it would not be able to file its 10-K by the March 16 deadline.

Silvergate's stock crashed 57% on March 10th after delaying their 10-K filing. This is a fresh record low for the company, following SI stock's 35% crash in late trading. SI stock peaked at 239.26 in November 2021.

Signature Bank (SBNY), which has been trying to reduce its crypto exposure after increasing it in prior years, fell modestly overnight. SBNY stock is at a two-year low. Coinbase (COIN) fell slightly. Coinbase said March 2 that it had switched to Signature Bank for facilitating dollar transfers, away from Silvergate.

The news from Silvergate Capital didn't have much of an effect on the price of Bitcoin.

AXP announced today that it will be repurchasing $15 billion of its own stock.AXP announced a stock buyback of $15 billion today.

AXP stock rose slightly in late trading after the credit card giant announced it would buy up to 120 million shares, replacing the roughly 36 million remaining on a prior repurchase plan. American Express also hiked its quarterly dividend by 15% to 60 cents a share. American Express stock dipped 0.3% to 174.83 on Wednesday, again finding support around the 21-day line. AXP stock has a 182.25 cup-with-handle buy point.

MDB's stock plunged after hours as MongoDB's earnings topped views but guidance disappointed. MongoDB's stock rose 2.3% to 228.70 in Wednesday's session, just below the 200-day line after rebounding from the 50-day line last Friday. The database software firm is working on a short consolidation with a potential 248.25 buy point.

The stock market is on the rebound after a sharp sell-off last week.After a sharp sell-off last week, the stock market is on the rebound.

The stock market rally traded mixed, closing up and down.

The Dow Jones Industrial Average dipped 0.2% and the S&P 500 index edged up 0.1% in Wednesday's stock market trading. ON stock and AMD were the top two performers. The Nasdaq composite rose 0.4%. The small-cap Russell 2000 eked out a fractional gain.

U.S. crude oil prices fell 1.2% to $76.66 a barrel. Copper futures increased 1.4%.

Boost Dollar

The dollar was higher on Tuesday, bolstered by a rise in U.S. Treasury yields and an outlook for further interest rate increases from the Federal Reserve.

The dollar was higher on Tuesday due to an increase in U.S. Treasury yields and the Federal Reserve's outlook for further interest rate increases.

After falling to 3.9% during the day, the 10-year Treasury yield remained flat at 3.97%. The 2-year Treasury yield climbed 5 basis points to 5.06%, and the 6-month T-bill yield gained 2 basis points to 5.31%.

The odds of a 50-basis-point rate hike on March 22 rose to 7x% from 70.5% on Tuesday and just 31% on Monday. On Tuesday, Fed chief Jerome Powell testified that he expects rates to go higher than previously expected, and perhaps at a "faster" pace. This hit stocks that day.

The Federal Reserve's beige book report, released at 2 p.m. ET Wednesday, showed little or no growth in six of the 12 Federal Reserve districts over the past several weeks. Inflation remained widespread, though it was moderating.

are a type of investment

ETFs (Exchange Traded Funds) are a type of investment that allows you to buy a basket of assets in a single transaction.

The Innovator IBD 50 ETF (FFTY) rose 0.8% among growth ETFs, while the Innovator IBD Breakout Opportunities ETF (BOUT) climbed 0.5%. The iShares Expanded Tech-Software Sector ETF (IGV) edged up 0.2%. The VanEck Vectors Semiconductor ETF (SMH), with Nvidia stock as the No. 1 holding and AMD also a top component, popped 2.6%. ON stock and Monolithic Power also are in SMH.

The ARK Innovation ETF (ARKK) and ARK Genomics ETF (ARKG) both dipped 0.1%, reflecting more-speculative story stocks. Tesla stock is a major holding across Ark Invest's ETFs, as is COIN stock owned by Cathie Wood's Ark.

The SPDR S&P Metals & Mining ETF (XME) closed up 0.25%. The U.S. Global Jets ETF (JETS) ascended 0.45%. The SPDR S&P Homebuilders ETF (XHB) climbed 1%. The Energy Select SPDR ETF (XLE) lost 1% and the Financial Select SPDR ETF (XLF) dipped 0.4%. The Health Care Select Sector SPDR Fund (XLV) declined 0.5%.

Has Plummeted

Tesla stock has dropped significantly in the past few months.

Tesla stock fell 3% to 182 on Wednesday, hitting its lowest level in over a month.

The National Highway Traffic Safety Administration has opened two new Tesla safety probes. One covers steering wheels that come off on some 2023 Model Y crossovers due to a missing bolt that holds the wheel to the steering column. The investigation covers an estimated 120,000 Model Y vehicles.

The NHTSA has announced a special probe into a fatal Tesla crash into a parked fire truck on Feb. 18. The regulatory agency believes the Model S was operating with an automating driving system and has a large number of ongoing Tesla crash probes related to Autopilot or Full Self-Driving, including several related to incidents involving stationary emergency vehicles.

Berenberg lowered Tesla's stock rating to "hold" from "buy," saying the share price has reached a level that fairly reflects the company's value. The analyst said Tesla's price cuts will reduce gross margins in the short run but sees the company achieving high margins over the long term.

Tesla stock has fallen 10.2% since the March 1 Investor Day. While the EV giant confirmed plans for a Mexico plant, it didn't offer much on a future next-generation vehicle, presumably a low-cost EV.

Although Tesla's stock is down from its high in February, it is still up from its January low.

There were three main factors that caused Tesla's big early 2023 rally. The first was that investors believed the January price cuts would lead to an increase in deliveries. The second was that there were high hopes for Tesla's Investor Day announcements. The third factor was the broader market rally that was driven by growth.

However, Tesla is still managing to make some progress by offering additional discounts to achieve incremental delivery gains in the first quarter. Even though Investor Day failed to excite, the market has not been doing well since early February.

TSLA stock has held most of its early 2023 gains in that context.

It's possible that Tesla's stock will form a bottom and start to increase again, with a buy point above the 200-day line. This could involve Tesla's stock testing the 50-day/10-week lines.

The stock market is on the rebound after a sharp sell-off last week.After a sharp sell-off last week, the stock market is on the rebound.

The stock market rally is still closely linked to its moving averages.

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The S&P 500 closed slightly higher, but just below its 50-day line after undercutting that key level Tuesday. The Russell 2000 broke below its 50-day line intraday, hitting its lowest levels since late January, before rallying for a wafer-thin advance.

The Dow Jones fell, not far from its 2023 lows and 200-day moving average.

The Nasdaq rose modestly but struggled to break resistance at the 21-day line.

On Friday, it looked like the market rally was emerging from a short-term trading range, only to fall back this week. More broadly, the major indexes are in the lower half of a trading range going back to early February.

leading stocks did better on Wednesday

Nvidia, On Semiconductor, and other chipmakers were strong today, helping to support the Nasdaq along with a slim gain from Apple. But there aren't many buy signals in this sector right now.

Arista Networks (ANET) is rising to the edge of the buy zone, while some software plays such as New Relic (NEWR) and Fortinet (FTNT) are gaining ground within their post-gap-up consolidations.

Airline stocks maintained their altitude, though cruise lines took on water. Homebuilder stocks have held up remarkably well given the rising Treasury yields.

Other names faded when the market crashed, but the leaders didn't lose much.

If you're reading this, it means you're taking the first step towards making a change. That's great! The next step is finding out what kind of change you want to make.What kind of change do you want to make?

Around key levels, the market rally is struggling again.

Although some stocks are doing well, many recent purchases have not been successful or have not progressed. It would probably be best to wait and see what happens next with the stock market rally before taking any further action.

While the S&P 500 and other indexes aren't far from their recent lows, a couple of good days is all the rally needs to look healthy again. So take this time to prepare your watchlists.

You should read The Big Picture every day to keep up with the market direction and leading stocks and sectors.