- The Dow Jones fell on Tuesday, but still remains within the recent consolidation.
- The actions retreated after the US IPC inflation was presented higher in June, fueling concerns about Fed’s fees.
- The profits of the great banks were also mixed or lower, forcing a slight decrease in the feeling of investors.
The industrial average Dow Jones (DJIA) stumbled on Tuesday, losing enough land to bring to the megacapitalized index below the closing of the previous week, but still staying at short -term consolidation levels. The US consumer price index (CPI) showed that price pressures are still on the wrong side of the Federal Reserve objectives (FED), further moving away the hopes of investors from a rate cut in summer.
Inflation: Back in the menu?
The US IPC inflation increased towards the end of the second quarter. Although the figures remained mostly online or exceeded medium forecasts, investors still feel the pressure of the growing price pressures. The inflation of the annualized general CPI rose to 2.7% year -on -year in June, moving in the opposite direction to the objective range of 2% Fed policy. With the inflationary pressures still bubbling in the background, the thin hopes of the market for an early cut of fees of the Fed have evaporated.
According to the Fedwatch of the CME tool, the fees operators have completely discounted a pause in the rates at the Julio Rate Meeting of the Fed. The hopes of a rate cut in September were also affected after the CPI, with a 44% probability of maintaining the rates. Rate markets are still waiting for two cuts in 2025 despite the still warm inflation measures, with an 80% probability of at least one cut of a decontked point for October.
Technological actions continue to cover possible cracks in the sharing market
In other places in the markets, technological rally fans captured an impulse after the CEO of Nvidia (NVDA), Jensen Huang, announced that the Trump administration would grant NVIDIA a relief of technological restrictions on China, allowing the semiconductor giant to resume the sale of chipsets focused on the Chinese market. However, the announcement can come with conditions: Trump’s team is preparing for a large -scale ad at the end of the month to declare their plans to ensure the continuous domination of the US in the technological space of AI. With the habit of the Trump administration to quickly change between new and old regulations, exemptions and restrictions, there could be material changes in NVIDIA access to foreign markets long before highly profitable hardware exports can be resumed.
Even so, things look good for Nvidia; The chips manufacturer is the first company in history to reach a market capitalization of 4T of dollars. Nvidia has risen around 1,500% since its minimum after the COVID of 10.81 $ per share in October 2022.
Banking actions also stumbled on Tuesday. The profit reports of the second quarter in general exceeded expectations; However, the Declive Income Guide caused Wells Fargo (WFC) to fall around 4% in the day. JPMorgan Chase (JPM) also decreased slightly despite exceeding general gain expectations, and the Blackrock asset management giant (BLK) collapsed 6% after not complying with income forecasts.
Dow Jones price forecast
Despite technological profits, Dow Jones is in red on Tuesday, falling more than 0.85% from top to bottom and losing almost 400 points at its lowest point, while the bullish exhaustion gives way to an irregular consolidation phase, testing below 44,200 per second time this week. Despite the recent consolidation, the Dow still remains firmly on the upward side, although still below the historical maximums above 45,000, since the Blue Chips index, heavy in the industry, subperforma compared to its biased peers towards technology.
5 -minute graph of Dow Jones
Dow Jones daily graphics
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.
