US Market Outlook: Bourses get a breather
The benchmark indices, however, have to breach their resistance to become bullish again
Last week, the US stock market saw a brief respite as the Dow Jones Industrial Average, S&P 500 and NASDAQ Composite index recorded gains of over 2 percent each. The Dow Jones snapped its two-week decline, while the S&P 500 and NASDAQ also managed to reverse their four-week slump. Although the recent rise provided some relief, analysts are cautious and await a sustained increase to confirm the trend.
The mixed price action on daily charts suggests a potential trading range between 51,000 and 54,000 for the Dow Jones. A breakout above 54,000 could propel the index to 56,000, while breaking below 51,000 may push it to 50,000-49,500. The S&P 500's journey to 7,880-7,900 will depend on its ability to surpass the resistance level of 7,690 decisively.
The NASDAQ Composite index must exceed 26,200 to signal a bullish outlook, potentially reaching 28,000. The US dollar index (103.41) experienced a significant climb last week due to higher-than-expected inflation data, leading to expectations of further rate hikes from the Federal Reserve. This strength rose above the anticipated 103.50, testing immediate resistance at 103.90.
Should it fail to break through this barrier, a correction to 102.50 could ensue. If the index manages to clear the hurdle, it could potentially soar to 105. The US 10-year Treasury yield (5.14 percent) has surged, breaching a key threshold of 5.05 percent. Supported by the previous inflation data and likely to sustain its rise to 5.30-5.35 percent, marking a positive medium-term outlook.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
