Dow Jones Futures Fall As Trump Picks Kevin Warsh To Be Fed Chairman; Sandisk Soars, Tesla Rises On SpaceX Buzz

2026-02-20 20:39:20

Dow Jones futures fell modestly early Friday, along with S&P 500 futures and Nasdaq futures. President Donald Trump on Friday named Kevin Warsh to be his nominee for Federal Reserve chairman.

Apple (AAPL), Sandisk (SNDK), Western Digital (WDC) and KLA Corp. (KLAC) were key earnings movers overnight. Tesla (TSLA) rose on a report that Elon Musk’s SpaceX could merge with the EV maker.

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The stock market sold off Wednesday morning, testing key levels before paring losses substantially. Microsoft, SAP (SAP) and ServiceNow (NOW) slammed the software sector. Meta Platforms (META) was among several big earnings winners.

Google parent Alphabet (GOOGL), Nvidia (NVDA), GE Vernova (GEV), Quanta Services (PWR), Ciena (CIEN) and Vertiv (VRT) were AI plays that held buy points.

Whether or not Thursday’s action was a blip or more concerning, signs of excessive bullishness made the market more vulnerable to a sell-off.

The video embedded in the article reviews Thursday’s market action and analyzes Google stock, Viking Holdings (VIK) and MongoDB (MDB).

Nvidia, Google, Viking and GE Vernova stock are on Leaderboard. Viking stock is on SwingTrader. Vertiv and MongoDB stock are on the IBD 50 list. Google stock is on the IBD Big Cap 20. Nvidia stock is on IBD Sector Leaders. GE Vernova was Thursday’s IBD Stock Of The Day.

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Trump Nominates Warsh For Fed Chairman

President Trump, in a Truth Social post early Friday, named former Fed Gov. Kevin Warsh to be his nominee for Fed chairman. Fed chief Jerome Powell’s term ends on May 15, but he could choose to stay as a Fed governor until early 2028.

The Senate must confirm Trump’s nominee. Some GOP lawmakers have expressed misgivings about confirming a Trump pick while the Justice Department conducts a criminal probe of Powell.

Dow Jones Futures Today

Dow Jones futures lost 0.45% vs. fair value. S&P 500 futures declined 0.4% and Nasdaq 100 futures fell 0.5%.

The dollar rallied on the Warsh pick, sending gold tumbling and silver diving more than 10%. Bitcoin continued to slide.

The 10-year Treasury yield rose slightly to 4.25%.

Also late Thursday, President Trump backed a government funding bill in the Senate that would include a short-term extension for Homeland Security funding. That could help avert a government shutdown on Saturday.

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 leading stocks and the market on IBD Live

Apple, Other Key Earnings

Apple earnings and revenue topped fiscal Q1 views amid strong iPhone sales, especially in China. Apple stock edged lower early Friday, still below the 50-day line. AAPL stock is working on a 288.62 consolidation buy point.

Memory plays Western Digital and Sandisk — spun off from Western Digital last year — beat views and guided higher Thursday night. So did chip-equipment giant KLA Corp. Memory plays are seeing enormous, sustained AI demand, spurring huge price increases. Chip-gear makers are riding massive spending on semiconductor equipment, including from memory concerns.

Sandisk surged 20% in premarket trade, after more than doubling so far this month. Western Digital declined solidly and KLA fell sharply. Both are also up significantly so far in 2026.

Stock Market Rally

The stock market rally saw the key indexes tumble Thursday morning, with the Nasdaq undercutting its 50-day line. But the tech-heavy index rebounded to close above its 21-day line. The Dow Jones, S&P 500 and small-cap Russell 2000 had more modest intraday losses and bounced after briefly undercutting their 21-day lines.

Software companies and other earnings losers hit the market early on, along with fears of a U.S. strike on Iran.

Stocks finished strong on reports that a Trump-Senate deal was close to avert another shutdown.

The Dow Jones Industrial Average rallied to close up 0.1% in Thursday’s stock market trading. The S&P 500 index dipped 0.1%. The Nasdaq composite retreated 0.7%. The Russell 2000 ended fractionally higher.

The latest Investors Intelligence Bulls vs. Bears indicator showed that 61.5% of newsletter writers are bullish. When bullishness tops 60%, that’s often a sign that a short-term market top is near.

The Nasdaq-led retreat was concentrated in software, while much of the market had minimal losses or gains. Big earnings winners and losers were plentiful.

U.S. crude oil prices jumped 3.5% to $65.42 a barrel, a four-month high. President Trump made new threats vs. Iran as U.S. warships move into position.

The 10-year Treasury yield fell two basis points to 4.23%.

ETFs

Among growth ETFs, the Innovator IBD 50 ETF (FFTY) sank 2.6%. The iShares Expanded Tech-Software Sector ETF (IGV) plunged 4.9%, with Microsoft, ServiceNow and SAP fueling broad software pain. The VanEck Vectors Semiconductor ETF (SMH) edged up 0.2%. Nvidia stock is the No. 1 holding in SMH, with KLA also a member.

ARK Innovation ETF (ARKK) fell 1.65% and ARK Genomics ETF (ARKG) declined 0.4%. Tesla stock is the biggest position across ARK Invest’s ETFs.

SPDR S&P Metals & Mining ETF (XME) retreated 1.5%. The Energy Select SPDR ETF (XLE) climbed 0.9% and the Health Care Select Sector SPDR Fund (XLV) slipped 0.3%.

The Industrial Select Sector SPDR Fund (XLI) was up 1.05%, with GE Vernova stock a major position. The Financial Select SPDR ETF (XLF) added 1.1%.

Best Growth Stocks To Buy And Watch

Tesla Stock Bounces On SpaceX Buzz

Tesla stock rose modestly overnight after Bloomberg reported late Thursday that SpaceX could merge with Tesla or xAI before its expected mammoth IPO later this year. Earlier, Reuters had reported that SpaceX and AI startup xAI, both owned by Elon Musk, were in talks.

On Wednesday night, Tesla said it was investing $2 billion in xAI.

In Thursday’s session, TSLA stock fell 3.45% to 416.56, a two-month low and losing sight of its 50-day moving average. Late Wednesday, Tesla reported lower earnings that beat views thanks to some one-off factors. On the call, Musk signaled a cash-burning spending spree in 2026 and the end of new models with steering wheels or pedals.

Google, Nvidia Lead AI Stocks In Buy Zones

Google stock tested its 21-day line, but rebounded to close up 0.7% to 338.25, holding the flat-base buy point of 328.83. The relative strength line is at a new high on a weekly chart, reflecting GOOGL stock’s outperformance vs. the S&P 500. Google earnings are due next Wednesday.

Nvidia stock also tested its 21-day line, but ultimately edged up 0.5% to 192.51. Shares are holding above a trendline entry and a 190.44 short-term high. The official buy point is 212.19.

GE Vernova stock fell as low as 681.70, but closed up 0.8% to 717.39. That’s just above an early entry of 701, cleared Wednesday after the natural gas turbine maker beat Q4 views. GEV stock has a 731 flat-base buy point, according to MarketSurge.

Vertiv stock undercut a 189.66 double-bottom base, but rebounded to finish up 0.7% to 195.10.

Ciena stock fell 1.5% to 253.53, but came off lows. The fiber optic play has a 261.13 ascending-base buy point, but is actionable from breaking a short downtrend on Tuesday. Ciena’s RS line also is at a new high.

Quanta Services inched up 0.45% to 483.43, holding a 473.99 flat-base buy point after briefly undercutting that intraday. The heavy construction firm is an AI-related play due to its work building power plants. PWR stock’s RS line is at a new high.

What To Do Now

The stock market rally had a scary morning but ultimately showed resilience. High bullishness is something to note, though psychological indicators are ultimately secondary to the major indexes and stocks.

Outside of software and some earnings losers, the market and leading stocks are still in solid shape.

On bad or whipsaw days, pay attention to stocks holding key levels, showing relative strength, such as Google, Vertiv and Viking Holdings. Those could offer buying opportunities.

But earnings will remain heavy over the next week. So be cautious about new buys.

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

Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.

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