Dow Jones futures were little changed Thursday morning, along with S&P 500 futures and Nasdaq futures. PacWest Bancorp revived deposit flight fears for regional banks, with PACW stock plunging yet again.
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The stock market rally closed mixed Wednesday, amid a tame CPI inflation report and a big move by Google parent Alphabet (GOOGL). The Nasdaq jumped to a 2023 high, while the S&P 500 had a decent advance.
Google flashed buy signals as it touted its artificial intelligence efforts as it tries to beat back Microsoft (MSFT). Advanced Micro Devices (AMD), another AI play, continued its big recent bounce.
Aside from some megacap techs and beaten-down software names, market action wasn’t as strong as the Nasdaq suggested.
But the S&P 500 lagged the Nasdaq while the Dow Jones and an S&P 500 equal-weight ETF edged lower.
Finally, buying opportunities remained relatively light.
These aren’t reasons to be bearish, but investors should temper their bullish enthusiasm.
PacWest Bancorp Deposits Fall
In other news, PacWest Bancorp (PACW) disclosed early Thursday that its deposits fell by 9.5% in the week ended May 5, with most of that coming on May 4-5. That followed news reports May 3 that PacWest was exploring strategic options, including a possible sale. The California-based PacWest pledged another $5.1 billion in loans to the Federal Reserve to obtain $3.9 billion in additional borrowing.
PACW stock plunged more than 15% Thursday morning.
Western Alliance Bancorp (WAL) fell sharply in sympathy. The regional bank ETF KRE, already down this week, also is losing ground.
Earnings
Walt Disney (DIS), Trade Desk (TTD), Robinhood Markets (HOOD), DoubleVerify (DV), Maxeon Solar Technologies (MAXN), Sonos (SONO) and Allegro Microsystems (ALGM) reported late Wednesday.
Disney earnings were mixed but streaming losses narrowed as price hikes offset Disney+ subscriber losses. DIS stock fell solidly after hours.
Trade Desk beat views and guided higher. TTD stock rose modestly overnight, signaling a move above buy points. DoubleVerify earnings and revenue topped. DV stock popped early Thursday, signaling a move back above the 50-day line.
Robinhood topped forecasts and said it will launch 24-hour trading. HOOD stock rose solidly in premarket action but has been trading below moving averages.
Maxeon Solar crushed EPS views and raised full-year EBITDA guidance. MAXN stock leapt over 10% after bouncing from its 10-week line on Wednesday.
ALGM stock rallied on strong Allegro Micro earnings. But the EV-exposed chipmaker is still recovering from an April sell-off. Sonos stock plunged as the smart-speaker maker guided low.
Microsoft stock is on IBD Long-Term Leaders. The video embedded in this article discussed Wednesday’s up-and-down market action and analyzed Google stock, Flywire (FLYW) and Axon Enterprise (AXON).
Dow Jones Futures Today
Dow Jones futures fell 0.2% vs. fair value, with DIS stock a Dow component. S&P 500 futures edged higher and Nasdaq 100 futures rose 0.3%. Futures weakened as PACW stock tumbled, but have steadied somewhat.
The 10-year Treasury yield fell 4 basis points to 3.4%.
Crude oil futures lost a fraction. Copper sank nearly 3%.
The Bank of England raised interest rates by a quarter-point, as expected.
The Labor Department will release the April producer price index and weekly jobless claims at 8:30 a.m. ET Thursday.
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
Google AI Efforts
Google stressed artificial intelligence at its annual developer conference Wednesday. The internet giant said it will introduce AI to search. Notably, Google explained how it’ll keep ads in search results.
Google stock popped 4.1% to 111.75, hitting an eight-month high. GOOGL stock is just in range from a 106.69 cup-with-handle buy point initially cleared on April 6. Investors also could use the April 6 high of 109.17 as another entry.
Google is accelerating its AI efforts, to catch up to Microsoft (MSFT), which has used OpenAI’s ChatGPT technology in search and more.
MSFT stock climbed 1.7% to 312.31, working on a possible three-weeks-tight base around a 52-week high.
AMD stock climbed 2.1% to 97.06, though it backed off morning highs. Since tumbling on May 3 on weak guidance, AMD stock has surged 19%, racing past its 50-day line and an early entry. That bounce kicked off on a report that AMD and Microsoft were teaming up on an AI processor. The advance continued even after Microsoft denied the report, in part.
Google also announced a $1,799 folding phone, the Pixel Fold.
Read More: Dow Jones Futures Fall: Nasdaq Steps Up, But PacWest Dives On Deposit Slide