- The Dow Jones industrial average was dragged up for technological profits on Tuesday.
- Missing significant news, investors expect Trump’s technological block over China to seep.
- Commercial tensions are still increasing while the US and China collide on the terms of the preliminary trade agreement.
The industrial average Dow Jones (DJIA) rose on Tuesday, backed by incessant optimism in the technological sector. The LEA Rally leader, Nvidia (NVDA), headed a chip -based market advance, exceeding Microsoft market capitalization for the first time since January. An unexpected but welcome in Jolts work offers in April helped even more strengthening the feelings of investors, who ignored a worse contraction than expected in factory orders during the same period.
Operators bet on another Trump commercial turn
Investors continue to trust an eventual commercial agreement between President Trump and Chinese President Xi Jinping, despite increasing commercial tensions while both parties are launched to violate the terms of the preliminary trade agreement. The Trump administration staff continues to insist that Trump and XI will speak directly soon, but the specific details remain limited.
The White House Press Secretary, Karoline Leavitt, confirmed Tuesday that Trump’s team had sent a blunt letter to the main US business partners, as reported earlier this week. The letter requires that countries present their “best offer” in terms of trade agreements for Wednesday, so that the Trump team considers it. Trump’s temporal delay in his own package of “reciprocal tariffs” is scheduled to expire in early July, and despite the insistence that multiple important commercial agreements are “ready to be announced”, very little in terms of commercial agreements that avoid tariffs has been presented.
Despite the optimism in the market, those responsible for policies remain cautious
Those responsible for Federal Reserve Policies (FED) remain apprehensive about the future state of the US economy in an environment after tariffs, and the last minutes of the meeting of the Fed discount rate reveal a similar position of a growing number of commercial operators in the USA is still too early to see much in terms of immediate impacts of tariffs; However, the Organization for Economic Cooperation and Development (OECD) has reduced its growth forecast for the US economy this year to 1.6% from 2.2%.
Jolts job offers increased to 7,391 million in April, challenging the setback to 7.1 million. On the other hand, US factory orders contracted more than expected in April, falling 3.7% monthly, its lowest figure in 15 months. The previous month also saw a strong downward review, sliding to 3.4% from the initial printing of 4.3%.
The results of the Survey of the Purchasing Management Index (PMI) of the US ISM services will be published on Thursday, and investors expect a slight recovery in the added feeling of commercial operators. It is forecast that the impression of the PMI of services of the ISM of May will increase to 52.0 from April 51.6.
Dow Jones price forecast
Despite an intradication of hopes in technology and trade, Dow Jones continues in a congestion zone between 42,000 and 43,000. The main stock market index recovered 42,500 after trying the low side earlier this week, and investors continue to incline the stable side.
The Dow Jones industrial average continues to quote on the high side of the exponential mobile (EMA) average of 200 days about 41,675. However, technical oscillators are leaking in overcompra territory, which could open the door to a downward technical correction.
Dow Jones daily graphics
Dow Jones Faqs
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.
