- Dow Jones chalked in further gains on Friday as investors sentiment climbs.
- Equities are on pace for one of their best weeks of the year.
- Consumer sentiment indicators ticked higher on Friday.
The Dow Jones Industrial Average (DJIA) notched in 100 points on the high side on Friday after kicking the day off on the low side. Bids tested low early in the day before recovering the 40,500.00 level and investors are knocking on one of the index’s best single-week performances of the year to-date.
The Dow Jones is up nearly 4% from Monday’s opening prices as investors find the buy button after improving US economic data helped trader slough off broad fears of a US recession. The University of Michigan’s August Consumer Sentiment Index improved to 67.8, well above the previous 66.4 and beat the forecast 66.9.
Improving consumer sentiment indicators helped to bolster investor confidence further, despite UoM 5-year Consumer Inflation Expectations holding firmly at 3.0% MoM in August. Bets of a double cut from the Federal Reserve (Fed) in September have eased to just 25%, down from last week’s peak of 70%, but markets are still fully pricing in some form of rate movement on September 18, with rate markets putting odds of a 25 bps rate cut at 75%.
Dow Jones news
A risk-on Friday means the majority of the Dow Jones index was the green for the day. Less than a third of the DJIA saw red on Friday, with losses being led by Caterpillar Inc. (CAT) and Microsoft, which both fell around six-tenths of one percent. CAT traded near $343.15 per share, while MSFT battled it out near $418.60. Boeing Co. (BA) and Cisco Systems Inc. (CSCO) were neck-and-neck at the top of the boards, each gaining a little less than 2% on the day, with BA testing $180.00 per share and CSCO within reach of $50.00.
Read more: Nike stock gains on continued interest in Ackman stake
Dow Jones price forecast
The Dow Jones is knocking on a 3% single-week gain on Friday, poised to chalk in the index’s single best week-on-week performance in 2024. All-time highs at 41,371.38 set in mid-July have come back into view for bidders as DJIA prices grind their way back into the high side following last week’s brief dip below 38,500.00.
The Dow is testing deep into the green for the fourth straight day, trading within touch range of 40,750.00 after buyers took a thin technical bounce from Monday’s lows at the 39,250.00 level. Price pressures will begin to mount as bids approach 41,000.00, but the DJIA continues to put in a solid run as prices run well north of the 200-day Exponential Moving Average (EMA) at 38,053.00.
Dow Jones daily chart
Economic Indicator
UoM 5-year Consumer Inflation Expectation
The University of Michigan's Survey of Consumers includes a long-run, five-year, inflation expectation component that the Fed uses when calculating its quarterly Index of Common Inflation Expectations.
Read more.Last release: Fri Aug 16, 2024 14:00 (Prel)
Frequency: Monthly
Actual: 3%
Consensus: -
Previous: 3%
Source: University of Michigan
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD languishes near multi-year low after RBA meeting minutes
AUD/USD remains depressed after the December RBA meeting minutes reiterated that upside inflation risks had diminished, which reaffirms bets for a rate cut in early 2025. This, along with concerns about China's fragile economic recovery and US-China trade war, undermines the Aussie and weighs on the currency pair.
USD/JPY sticks to positive bias after BoJ meeting minutes
USD/JPY holds steady above the 157.00 mark and moves little following the release of the October BoJ meeting minutes, emphasising a cautious approach to monetary policy amid domestic and global uncertainties. Adding to this, doubts over when the BoJ will hike interest rates again, which, along with a positive risk tone, undermines the safe-haven JPY.
Gold flat lines above $2,600 ahead of holiday trading week
Gold price trades flat around $2,610 during the early Asian session on Tuesday. Markets face a relatively quiet trading session ahead of the holiday trading week. The US Richmond Fed Manufacturing Index for December is due later on Tuesday.
Ethereum risks a decline to $3,000 as investors realize increased profits and losses
Ethereum is up 4% on Monday despite increased selling pressure across long-term and short-term holders in the past two days. If whales fail to maintain their recent buy-the-dip attitude, ETH risks a decline below $3,000.
Bank of England stays on hold, but a dovish front is building
Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.