- The Dow Jones lost 600 points on Thursday, falling 1.45%.
- IPP inflation in the US reached a weak point, further relieving the fears of a restart of inflation.
- Despite the decrease in price pressures, actions still suffered a blow while Trump threatens with more tariffs.
The Dow Jones industrial average (DJIA) fell around 600 points on Thursday, decreasing almost one and a half percent after the president of the United States (USA), Donald Trump, and his administration intensify his rhetoric on the commercial war. President Trump focused on threatening new tariffs on specific goods from the European Union after his tactics of trying to press Canada to make commercial concessions did not give results earlier this week.
The US Production Price Index (IPP) cooled faster than expected in February, with underlying IPP inflation decreasing to 3.4% year -on -year compared to the expected impression of 3.5% and 3.6% in January. The general IPP inflation also cooled, falling to 3.2% in annualized terms compared to the 3.3% forecast, however, the impression of the general IPP of January was reviewed up to 3.7% while the revisions continue to be a headache for preliminary data observers.
Despite a general decrease in the inflation data lot this week, the probabilities of another rate cut by the Federal Reserve (Fed) next week seem scarce. Inflation metrics are still maintained well above the annual objective of 2% of the Fed, and according to the Fedwatch of the CME, the rates markets are valuing virtually 100% probability that the FED maintains the stable rates after its rate decision meeting next week. Rate operators expect the next movement of the Fed on rates to be in June, if not later.
The president of the US, Donald Trump, began on Thursday promising to impose a 200% tariff on European wines if the EU does not go back to its 50% tariff on the whiskey produced in the US, which was imposed as a measure of retaliation against the 25% global tariff on steel and US aluminum that entered this week. President Trump tried to pressure his Canadian neighbors so that they did not respond to their steel import rates.
However, these measures were greatly deflated and did not result in concessions by Canada, and now the Trump administration is changing its strategy of retaliation tariffs towards Europe. Donald Trump also spoke again about ‘taking’ Greenland of Denmark while the US president reviews the conversation points of his campaign.
Dow Jones News
A large majority of the actions listed in the Dow Jones retreated Thursday, with two thirds of the index values falling in red. Verizon (VZ) bounced 2.5% to more than $ 43 per share while the telecommunications giant recovers from a fall earlier this week. Salesforce (CRM) and Home Depot (HD) fell more than 4%, lowering to $ 271 per share and below $ 350 per share, respectively. Technological actions and construction materials suppliers are increasingly restless to the commercial policies of the Trump administration.
Dow Jones Price forecast
The losses begin to accumulate in the graph of the Dow Jones industrial average, dragging the main stock market index at correction territory with the Dow Jones going down 2,000 points in the week. The Djia has lost almost 10% since the historical maximum of last November, just above 45,000, and the price action has been below the 41,000 area for the first time in 6 months.
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.
