- The Dow Jones recovers the 39,000.00 area as markets rebound after the Juneteenth holiday.
- Weakening US data helps reinforce rate cut expectations.
- The next notable data in the US will be the US PMI.
He Dow Jones Industrial Average (DJIA) is rising on Thursday as investors return to markets with a vengeance following the midweek Juneteenth holiday that shut down U.S. stock markets on Wednesday. The US economic agenda showed May building permits and the Philadelphia Fed manufacturing survey for June both below expectations, while initial jobless claims regained less ground than expected , recording another data above the four-week average.
With US economic numbers generally falling short of expectations, investor hopes that the Federal Reserve (Fed) will be forced into a rate cut sooner rather than later are at an all-time high. According to the CME’s FedWatch tool, rates markets are pricing in a greater than 70% chance that the Fed will make at least a quarter-point cut on September 18.
Despite the recent weakening of economic data, the Fed continues with a restrictive policy stance. Fed policymakers are determined to wait several months of moderate inflation numbers before considering changes to the policy rate. Despite fluctuations in jobless claims from week to week, the US labor market remains incredibly tight, giving Fed officials firm footing to avoid rushing into any abrupt policy adjustments.
US Purchasing Managers’ Index (PMI) figures will close out the trading week. Investors eager for rate cuts are looking for a continued cooling effect in US economic data. Manufacturing and services PMIs are expected to post small losses, with the June manufacturing PMI forecast to drop to 51.0 from 51.3 and the Services component to drop to 53.7 from 54.8.
Dow Jones News
The Dow Jones is firmly up on Thursday, with all but five of the index’s constituent stocks down on the day. Apple Inc. (AAPL) leads the declines, shedding 2.0% and falling below $210.00 per share as investors reconsider recent spending spurred by Apple’s announcement of greater integration of AI technology into pre-existing software offerings from Apple. Apple also announced the closure of its Pay Later program, which allowed Apple customers to make purchases on an internally funded installment plan.
On the bright side, Salesforce Inc. (CRM) rose 4.5% on Thursday after the digital customer data management firm announced its own fresh batch of AI technology integrations to investors. CRM rose above $242.00 per share as investors continue to buy AI technology announcements without much concern about how these companies will convert AI integrations into more sales.
Dow Jones Technical Outlook
The Dow Jones Index rose to new weekly highs on Thursday, testing its highest bids in nearly four weeks to reclaim the 39,000.00 area. The DJIA is testing chart territory above 39,200.00 and has made significant progress in a day to return to its all-time highs set above 40,000.00 in May.
The daily candlesticks have broken back above the 50-day EMA at 38,825.00, extending a recovery from a recent drop to the 38,000.00 area.
Dow Jones Five Minute Chart
Dow Jones Daily Chart
economic indicator
Weekly unemployment benefit requests
Weekly unemployment benefit applications are published by the US Department of Labor and is a measure of the number of people who have filed their first claim for unemployment insurance. In other words, it provides a measure of strength in the labor market. A higher-than-anticipated number indicates weakness in the labor market, which influences the strength and direction of U.S. economic activity. In this way, a lower than expected reading is bullish for the dollar.
Every Thursday, the US Department of Labor releases the number of initial claims for unemployment benefits for the previous week in the US. Since this reading could be very volatile, investors may want to pay more attention to the average four weeks. A bearish trend is considered a sign of an improving labor market and could have a positive impact on the performance of the USD against its rivals and vice versa.
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.
