Dow Jones futures fell solidly late Thursday, along with S&P 500 futures and Nasdaq futures, with U.S.-Iran tensions escalating after an airstrike killed a top Iranian general.

The stock market rally got off to a strong start in 2020, at least on the major indexes. Chips, software, solar, payments and China-related stocks tended to do well, including Apple (AAPL), Advanced Micro Devices (AMD), SolarEdge Technologies (SEDG), StoneCo (STNE), JD.com (JD), Paylocity (PCTY), Mastercard (MA) and Tesla (TSLA).However, small caps retreated along with biotechs, medical products firms and retailers, including Incyte (INCY), Insulet (PODD), Crispr Therapeutics (CRSP) and Target (TGT). These lagging sectors did pare losses as the overall stock market rally kept building strength.Apple stock and AMD stock jumped to new highs. Mastercard stock also hit a new high but remains in a buy range, according to Marketsmith analysis. SolarEdge stock broke out powerfully, while Paylocity stock and StoneCo stock cleared new entries and JD.com stock reclaimed a buy point. Tesla stock moved back to just below record highs. AMD stock and Tesla stock both got price-target hikes, with fourth-quarter Tesla deliveries still on tap.Meanwhile, Target stock fell below a recent buy point while once-hot Incyte stock, Insulet stock and Crispr stock are losing sight of their 10-week moving averages. Insulet stock and Crispr stock pared losses to just below their 50-day lines. Incyte stock plunged late after the biotech announced weak Phase 3 trial data.

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Dow Jones Futures Today

Dow Jones futures fell 0.6% vs. fair value, erasing slim gains. S&P 500 futures sank and Nasdaq 100 futures sank 0.7%. Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading in the next regular stock market session.

U.S. Airstrike Kills Iranian General Soleimani

Dow Jones futures fell sharply, gold price rose and crude oil futures spiked on big Mideast news. Iraq TV said Gen. Qassim Soleimani, head of Iran’s elite Quds Force, has been killed in an airstrike at Baghdad’s international airport. The strike also reportedly killed Abu Mahdi al-Muhandis, deputy commander of the Iran-backed Popular Mobilization Forces.

The Pentagon later confirmed that a U.S. strike killed Soleimani. The statement said „General Soleimani and his Quds Force were responsible for the deaths of hundreds of American and coalition service members and the wounding of thousands more.” It also said he was behind the recent storming of the U.S. embassy in Baghdad.

The death of Soleimani greatly heightens U.S.-Iranian tensions, with risks of major military retaliation or worse.

Current Stock Market Rally

SPDR Sector ETFs: Intraday % Chg
Industrials
1.89%
Information Technology
1.88%
Consumer Discretionary
1.19%
Communication Services
1.17%
Financials
0.97%
Energy
0.9%
Health Care
0.27%
Consumer Staples
-0.79%
Real Estate
-1.16%
Materials
-1.17%
Utilities
-1.25%
Provided by Nasdaq Last Sale.
Real-time quote and/or trade prices are not sourced from all markets.

The current stock market rally showed broad strength in the major market indexes. The Dow Jones Industrial Average rallied 1.2%, the S&P 500 index tacked on 0.8%, and the Nasdaq composite gained 1.3%, all hitting record highs intraday. The big-cap Nasdaq 100 surged 1.7% as Apple stock rallied 2.3%, Tesla stock jumped 2.8% and AMD stock vaulted 7.1%. The small-cap Russell 2000 dipped 0.1%, but finished well off intraday lows.

Growth stocks generally did well outside the medical space. Among the best ETFs, the Innovator IBD 50 ETF (FFTY) rose 1.6%. The iShares Expanded Tech-Software Sector ETF (IGV) rallied 1.8%, and the VanEck Vectors Semiconductor ETF (SMH) jumped 2.5%. The iShares Nasdaq Biotechnology ETF (IBB) dipped 0.5% but closed off lows.

The Dow Jones today is now 3.7% above its 50-day moving average. The S&P 500 index is 5.2% above that key level while the Nasdaq composite is now 5.8% over the 50-day. That’s about how far extended the major indexes were before the brief post-Thanksgiving pullback began. A retreat to the 50-day line would be normal action for the stock market rally, but could be heavily damaging for overextended investors who aren’t nimble.

Apple Stock, AMD Stock, Others On Leaderboard

Apple stock, Tesla stock, AMD stock, Mastercard stock and StoneCo stock are all on IBD Leaderboard.

Paylocity stock was among several new additions to IBD SwingTrader on Thursday.

While the overall stock market rally is looking strong, investors need to be aware of group or sector moves. Over the past year there have been notable shifts when the stock market rally looks solid but there’s major rotation among leading groups below the surface. Here’s a good rule of thumb: Focus on the very best stocks, but don’t be too concentrated in a particular group or sector.

Please follow Ed Carson on Twitter via @IBD_ECarson for stock market updates and more.

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