- The Dow Jones rises during the midweek session while other indexes struggle.
- The economic calendar for the day could be more uneventful, resulting in a lack of direction for equities.
- Upcoming on Thursday: US personal protective equipment (PPE) and retail sales data.
On Wednesday, the Dow Jones Industrial Average (DJIA) gained strong momentum and reached an intraday high of 39,200.00. The index performed better than its counterparts in the S&P 500 and the NASDAQ Composite. The NASDAQ Composite has experienced a decline of nearly 0.5% today, while the S&P 500 is slightly in negative territory, down by approximately 0.16%.
The Dow Jones experienced a sudden drop towards the end of the American trading session, resulting in a new daily low near 38,927.00. This decline occurred in thin markets, which are currently characterized by a significant lack of trading volume.
The rapid downward movement was swiftly countered, and the Dow Jones is now reclaiming higher ground due to a technical reversal. The Dow Jones closed slightly above the 39,000.00 mark at 39,043.32, registering a minimal increase of one-tenth of a percent on Wednesday.
The economic calendar for Wednesday offers little in terms of events, leaving equities in a state of uncertainty and needing more clear direction. Traders and investors will be preparing for the release of the US Producer Price Index (PPI) and Retail Sales data on Thursday. Friday will conclude the trading week with the upcoming release of the University of Michigan Consumer Sentiment indicators.
In the midweek session, US stocks are experiencing solid gains, particularly in the Energies and Materials Sectors, which have seen increases of 1.9% and 1.22%, respectively, despite a generally more cautious market sentiment. The Technology Sector stands out as a significant area of concern, experiencing a decline of almost one percent as investors retreat from the recent surge in tech stocks.
The Latest News From the Dow Jones Industrial Average
As the American market session progresses towards the latter part of the trading day, 3M Co. (MMM) emerges as the standout performer of the DJIA, with an impressive gain of almost 4%, pushing its trading price to $102.60 on Wednesday. 3M is experiencing a surge in momentum following the recent announcement of William Brown, the former head of L3Harris Technologies, assuming the role of CEO at 3M.
MMM has experienced a significant decline from its peak in 2017, when it reached an all-time high of over $225 per share. However, it has been gradually recovering and is currently valued at $102.77 per share after briefly dropping to $91.25 earlier this year.
Intel Corp. and McDonald’s Corp. vied for the top spot as the biggest decliners on the Dow Jones on Wednesday. Both stocks experienced a decline of approximately 3.5% during the day.
Reuters reports that Intel enjoys an unjust edge over its closest rival, AMD, thanks to a unique license granted by the US government during the tenure of former President Donald Trump. Intel has been given exclusive authorization to provide chips to Huawei, a prominent Chinese technology company.
However, this advantageous position may be at risk as AMD pursues measures to address the situation. Additionally, Intel’s export volumes to China have been decreasing due to a recent ban on technology exports to the country.
Technical Forecasts for the Dow Jones Industrial Average
The Dow Jones Industrial Average surged past the 39,000.00 level on Wednesday, reaching a new peak for the week at 39,200.00 and continuing its upward momentum beyond the 200-hour Simple Moving Average (SMA) around 38,890.00.
The DJIA has been facing difficulty surpassing the significant price level of 39,000.00. However, a supply zone close to 38,600.00 is preventing substantial losses in the short term during pullbacks.
The Dow Jones is poised to end Wednesday with another positive close, extending its streak of bullish sessions. This would make it the fifth consecutive candlestick out of the last six to show upward momentum. The index, despite some short-term consolidation, is confidently trading in bullish territory, with the 200-day SMA comfortably positioned below the current price action at 35,615.00.