Dow Jones
Dow Jones futures adds over 0.50% at 26,849 but is off the daily highs after the private payrolls as reported by ADP increased by 167k in July below the consensus estimates of one million. The jobs creation slowed down in July after the sharp rise in June figure to 4.314 million. The market has recovered almost 8 million jobs but is well below the 19.7 million jobs lost during coronavirus lockdown in March and April.
Investors speculate that politicians in Washington will soon reach a deal on a new relief package and helps boost investors sentiment. News earlier today that high-level officials from USA and China will return to negotiations via teleconference to discuss the progress of the phase one deal also helps risky assets.
The US Trade deficit narrowed to $50.7 billion in June below the expectations of $50.1 billion. The trade gap in May was at 54.8 billion.
Disney trades more than 6% higher in the premarket after the company reported earnings of 0.8/share beating the consensus for a loss of 0.64/share. CVS reported earnings of $2.64/share and revenue of $65.3 billion beating the analyst’s expectations. The stock is 4% higher in the premarket. Moderna announced that it would charge between $32 to $37 per dose for its COVID-19 vaccine.
Dow Jones futures are 0.72% higher at 26,909. The S&P 500 futures are 0.48 higher at 3,315, while Nasdaq futures are 0.02% higher at 11,090.
Dow Jones ended 2.32% higher at 25,595 after the index tested and bounced from the 50-day moving average. The index rejected several times the last two weeks at the 200-day moving average. The short term picture has improved after yesterday’s gains, but the long term outlook remains bearish below the 200-day moving average.
On the upside, first resistance for the Dow index stands at 25,601 the high from yesterday. A move above 25,601 might open the way for a test of 25,027 the high from June 24. If the bulls continue then the next supply zone for the Dow Jones is at 26,274 the 200-day moving average.
On the flip side, immediate support for Dow Jones index is at 25,096 the low from yesterday. Next support for the Dow Jones will be met at 24,952 the 50-day moving average. A break below 24,952 might open the way for a test of 24,755 the 100-day moving average.
