- Summary:
- The Dow Jones Industrial Average Index soared to new record highs on Boxing Day as progress on the US-China trade deal sparked the Santa Claus rally.
The Dow Jones Industrial Average index finished Boxing Day 105.9 points or 0.37% higher at its new record highs at 28,621.4.
Gainers and Losers
Gains were led by Apple at 1.98%, followed by JPMorgan Chase at 1.06%. In third was Walgreen with a 0.94% profit.
On the other hand, the only losers were: Boeing (-0.92%), Merck (-0.11%), Johnson & Johnson (-0.07%), 3M (-0.05%), and IBM (-0.05%). The US aircraft maker Boeing led losses concerns about the Boeing 737 MAX were renewed. A senior test pilot reportedly complained about the aircraft’s anti-stalling systems during its flight simulator tests.
US-China Phase One Progress Fuels Santa Claus Rally
With volumes low, the most recent updates on the US-China phase one deal sparked bullish rallies across major equities markets. On Thursday, it was reported by the Ministry of Commerce that the US and China are still making progress in their negotiations. They are reportedly in the process of translating, reviewing legalities, and proofreading the initial agreement set. This was the first time that China acknowledged the deal since it was announced earlier this month. In fact, there were also reports saying that China is preparing for a signing ceremony when the deal is finalized.
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Dow Jones Outlook
The hourly chart of Dow Jones CFDs shows that the stock index has been making higher highs and higher lows since December 19. In fact, connecting its most recent lows, we can see that the Dow Jones has some room to move lower to test support at the rising trend line. The area around 28,580.0 also coincides with the area around the 50% Fib level when you draw the Fibonacci retracement tool from the low of December 24 to this morning’s session highs.If support does not hold at this price, the stock index could fall to the next near-term support level at 28,500.
On the other hand, if risk appetite is sustained in today’s trading, the Dow Jones could be on its way to new record highs above 28,689.5.