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Key Points
- Tech sector boosts Nasdaq and S&P 500.
- Boeing’s struggles pressure Dow Jones.
- Fed policy anticipation impacts market outlook.
Tech Sector Spurs Market Gains
Monday’s trading session is witnessing a contrasting performance across major U.S. stock indexes. The tech sector, particularly companies like Nvidia and Amazon, drove the Nasdaq Composite and S&P 500 to gains. Investors, seizing the opportunity, bought the dip in technology stocks, countering the sector’s lackluster start to the year.
Boeing’s Impact on the Dow
In contrast, the Dow Jones Industrial Average faced downward pressure, largely due to Boeing’s challenges. The aviation giant’s stock plummeted over 8% following the Federal Aviation Administration’s decision to ground a portion of its 737 Max 9 fleet for inspections. This decision came after an incident involving an Alaska Airlines flight, significantly impacting both Boeing and Alaska Air’s stock prices.
Nvidia Surges to Record High
Nvidia reached a record high, and other tech giants like Apple and Amazon experienced gains. The semiconductor sector rebounded, while financial heavyweights like JPMorgan Chase and Wells Fargo saw declines ahead of their earnings reports.
Federal Reserve Policy Anticipation
Market focus now shifts to the Federal Reserve’s upcoming economic data releases. With the consumer price index and producer price index due for release, traders are closely watching for signs of the Fed’s rate cut trajectory. Current market odds suggest a more than 60% chance of a rate reduction as early as March.
Market Outlook: Mixed Sentiment
In the short term, the market presents a mixed outlook. The tech sector’s recovery suggests a bullish trend, yet aviation sector troubles and looming economic data release inject a sense of caution. Market sentiment will likely remain divided until clearer signals emerge from the Federal Reserve’s policy direction and upcoming financial reports.
Technical Analysis
The E-mini Nasdaq-100 Index, currently at 16631.50, is trading above both its 200-day moving average of 15301.92 and its 50-day moving average of 16154.95. This positioning above key moving averages typically indicates a bullish sentiment.
The index is also above the identified minor support level of 16203.25 and well above the main support at 15717.75. The lack of defined minor and main resistance levels suggests that there may be less immediate overhead resistance to upward movement.
In summary, the E-mini Nasdaq-100 Index’s current stance above both key moving averages and its support level, combined with the absence of immediate resistance levels, generally points towards bullish market sentiment.
This article was originally posted on FX Empire
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
