- Dow Jones releases charts as investors jockey for position ahead of Fed
- The Federal Reserve intends to keep interest rates unchanged this week, with markets awaiting further guidance.
- Investors have fully priced in the September interest rate cut.
The Dow Jones Industrial Average (DJIA) was in a tailspin Monday, hovering around 40,600.00 as investors buckled down in anticipation of the Federal Reserve’s (Fed’s) latest interest rate call. The Fed is generally expected to keep interest rates steady on Wednesday, but markets will be watching for any adjustments in future guidance ahead of a key rate call in September.
The Fed’s upcoming interest rate call on Wednesday will be closely watched as investors look for signs that the Fed is on track to deliver a hotly anticipated rate cut when the Federal Open Market Committee (FOMC) meets again in September. Markets are generally expecting a rate cut of at least a quarter percentage point on September 18, with interest rate markets pricing in a 90% chance of a 25 basis point cut and a hopeful 10% bet on a double cut, according to CME’s FedWatch Tool.
Also due Friday are U.S. nonfarm payroll (NFP) data, a key part of the Fed’s employment mandate, and investors will be looking for a further cooling in employment data to aid the Fed continue to implement a modern rate-cutting cycle in September. ADP’s July employment change data is due Wednesday and will provide a preview of Friday’s NFP employment report, although it is uncertain with a patchy history of accuracy.
Dow Jones News
The Dow Jones stalled in the mid-range amid serene trading on Monday, with about half of the index in the green throughout the day and the other half softening toward the lower end. McDonald’s Inc. (MCD) reported no quarterly revenue or earnings per share, but shares rose 4.4% to above $263.00 a share as the company vowed to do more to engage with competitors, conducting a “thorough review” of pricing options and expecting restaurant traffic to escalate as it adds value offerings.
Dod Jones’ Technical Outlook
The Dow Jones held steady near 40,600.00 on Monday, cyclically moving in a tight range throughout the day as investors struggle to keep a near-term rally on the balance sheet. The DJIA briefly fell below the 40,000.00 key price bracket last week after U.S. markets retreated from record highs.
The Dow Jones Index held its ground and set a modern short-term bottom near 37,395.00, but is still trading on the lower side of recent record highs set at 41,371.38. Long-term momentum continues to lean to the upside, with the Dow Jones Index trading well above its 200-day exponential moving average (EMA) at 38,011.80.
