1. Home
  2. Live Market Analysis
  3. DowJones - Pressure Mounting
DowJones - Pressure Mounting

The DowJones, one of the world’s leading indices declined during the latest trading session and continues to decline in this morning’s pre-market open. The price movement is being influenced by economic, political and sentimental factors.

The price movement of the DowJones mounted to a 1.98% decline in the latest trading session, and a further 0.45% decline before today’s US Session opened. In total, over the past 24 hours, it has measured a decline of 2.43%, putting the asset on a weekly decline of 2.16%.

Looking at the price movement of the asset it can be seen that the index has recently attempted to build up momentum to form a bullish trend and correct back upwards. However, the momentum was lost and the instrument fell into a sideways trend before breaking lower yesterday. Currently, the price is seeing lower price highs after each attempted gain in price, however, there has only been one successful lower “price low”, which is the latest price wave. This price wave has pushed the price below the moving average and volume weighted average price, indicating a weak price and sentiment.

Знімок екрана 2022-06-10 о 18.09.58.png

The pressure on the US stock market seems to be increased for two main reasons. The first is the expected increase in inflation, which, in turn, justifies the forecasts regarding the continuation of aggressive rate hikes by the US Federal Reserve. The market may also be stressed about the slowdown in the growth of the national economy, on top of the threat of a possible recession. Currently, this afternoon’s CPI data is expected to come in at +0.7%, indicating that the level of inflation is rising.

The second reason is the damp negative outlook on the economy given by the European banker and President of the ECB (European Central Bank), Ms Lagarde. According to Ms. Lagarde, the central regulator, believes that over the next 12 months, the economy is likely to witness high inflation with little economic growth. These are known to be the main two elements for a stagnated economy.

In the corporate segment, the American technology company Intel Corp. suspended the recruitment of new employees due to increased risks of economic uncertainty and even a potential recession towards the end of the year. This forced management to reconsider the capital investment plan and the functioning of the departments.

Growth in the domestic bond market continues to be a negative factor for the index. According to yesterday's auction report, 3-week and 8-week Treasury bills were placed at an increased rate of 1.040% and 1.150%, respectively, eliminating the possibility of a downward correction. On the other hand, the global 30-year Treasuries were placed at a rate of 3.185%, significantly higher than 2.997% on the previous placement. This may indicate that the market currently prefers safe and lower risk assets. Again this further pressures the equities market which can be deemed as medium to high risk.

The only stock to increase in value within the index was Home Depot which increased by 0.78%. All other stocks had declined with the largest declines seen with Boeing declining by -4.23%, Walt Disney by -3.76% and Apple by -3.60%. Other indices such as the SNP500 and NASDAQ had also declined during the latest trading sessions. The SNP500 declined by 2.38% and the NASDAQ by 2.74%.

The main driver in terms of economic events is likely to be the release of today’s CPI figure. Traders will be looking to see how the market reacts to the release.

IMPORTANT NOTICE: Any news, opinions, research, analyses, prices or other information contained in this article are provided as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and therefore, it is not subject to any prohibition on dealing ahead of dissemination. Past performance is not an indication of possible future performance. Any action you take upon the information in this article is strictly at your own risk, and we will not be liable for any losses and damages in connection with the use of this article.
RISK WARNING: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. A high percentage of retail client investors lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Copyright © 2022 – All rights reserved.

NAGA is a trademark of The NAGA Group AG, a German based FinTech company publicly listed on the Frankfurt Stock Exchange | WKN: A161NR | ISIN: DE000A161NR7.

Any trademarks appearing on this website are the property of their respective owners.

The NAGA Group AG is the holding company of various companies, such as NAGA GLOBAL LLC, NAGA MARKETS EUROPE LTD, NAGA Technology GmbH, NAGA Pay GmbH and has a close link with NAGAX Europe OÜ.

RISK WARNING: Derivatives are complex instruments and come with a high risk of losing money rapidly due to leverage. A high percentage of retail investor accounts lose money when trading derivatives with this provider. You should consider whether you understand how derivatives work and whether you can afford to take the high risk of losing your money.

Trading with NAGA Trader by following and/or copying or replicating the trades of other traders involves high levels of risks, even when following and/or copying or replicating the top-performing traders. Such risks include the risk that you may be following/copying the trading decisions of possibly inexperienced/unprofessional traders, or traders whose ultimate purpose or intention, or financial status may differ from yours. Before making an investment decision, you should rely on your own assessment of the person making the trading decisions and the terms of all the legal documentation.

Restricted countries: NAGA Group AG does not provide services for the residents of certain countries, such as Afghanistan, Albania, American Samoa, Australia, Barbados, Belgium, British Virgin Islands, Burkina Faso, Cambodia, Canada (including Quebec), Cayman Islands, Central African Republic, Congo, Democratic People's Republic of Korea, Democratic Republic of the Congo, Gibraltar, Guam, Haiti, Iran, Iraq, Isle of Man, Israel, Jamaica, Jordan, Libyan Arab Jamahiriya, Mali, Monaco, Morocco, Myanmar, Nicaragua, Philippines, Russian Federation, San Marino, Senegal, Serbia, Somalia, South Sudan, Sri Lanka, Syrian Arab Republic, Trinidad and Tobago, Tunisia, Turkey, Uganda, Ukraine, United Kingdom, US Minor Islands, US Virgin Islands, USA, Vanuatu, Yemen, Zimbabwe.

Member of NAGA Group AG that is publicly listed in Frankfurt Stock Exchange.
close icon
By using this website, you agree to our cookie policy