- Dow Jones are appreciated due to the growing probability that the Fed will make an interest rate cut in September.
- The operators monitor Trump’s actions regarding the nomination of a replacement for the governor of the Fed, Adriana Kugler.
- Palantir rose more than 4%, while HEMS & Hers Health collapsed approximately 13% in extended operations.
Dow Jones are seen before the opening of the US market on Tuesday, quoting around 44,380, with an increase of 0.17%, during the first European hours. Meanwhile, S&P 500 futures rise 0.25% to 6,370, and Nasdaq 100 futures advance 0.33% to quote over 23,300. The US PMI ISM data will be observed later in the North American session.
The futures of the US stock market indices can be appreciated due to the growing probability that the US Federal Reserve of 25 basic points by the Fed next month.
However, the operators are expected to closely monitor the US president, Donald Trump, while moving to nominate a replacement for the governor of the Fed, Adriana Kugler, who unexpectedly resigned on Monday. The new appointment could be more aligned with Trump’s impulse due to lower interest rates.
In the futures markets, Palantir jumped more than 4% after the AI software company exceeds the expectations of profits of the second quarter and raised its perspective, driven by a strong demand for its AI platform. However, Hims & Hers Health collapsed around 13% after not reaching income estimates for the second quarter. Investors now expect profit reports on Tuesday of key names such as AMD, Pfizer, Snap, Rivian and Yum! Brands
In the regular market on Monday, Wall Street recovered from the decline last week, with the Dow up 1.34%, the S&P 500 winning 1.47%, and the Nasdaq composite increasing 1.95%while operators digest the last round of corporate profits.
Dow Jones – Frequently Questions
The Dow Jones Industrial Avenge, one of the oldest stock market indexes in the world, consists of the 30 most negotiated values in the United States. The index is weighted by the price instead of capitalization. It is calculated by adding the prices of the values that compose it and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, also founder of the Wall Street Journal. In recent years it has been criticized for not being sufficiently representative, since it only follows 30 companies, unlike broader rates such as S&P 500.
There are many factors that promote the Dow Jones Industrial Average (DJIA) index. The main one is the added performance of the companies that compose it, revealed in the quarterly reports of business benefits. The American and world macroeconomic data also contribute, since they influence investor confidence. The level of interest rates, set by the Federal Reserve (FED), also influences the DJia, since it affects the cost of credit, on which many companies depend largely. Therefore, inflation can be a determining factor, as well as other parameters that influence the decisions of the Federal Reserve.
Dow’s theory is a method to identify the main trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Avenge (DJIA) and the Dow Jones Transportation Average (DJTA) and just follow the trends in which both move in the same direction. The volume is a confirmation criterion. The theory uses elements of maximum and minimum analysis. Dow’s theory raises three phases of the trend: accumulation, when intelligent money begins to buy or sell; Public participation, when the general public joins the trend; and distribution, when intelligent money abandons the trend.
There are several ways to operate with the DJ. One of them is to use ETF that allow investors to negotiate the DJ as a single value, instead of having to buy shares of the 30 companies that compose it. An outstanding example is the SPDR Dow Jones Industrial Avenge ETF (day). Future contracts on the DJ allow the specular operators about the future value of the index and the options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Investment funds allow investors to buy a part of a diversified portfolio of DJ values, which provides exposure to global index.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
