Dow Jones

Dow Jones Dips, Will Durable Goods Orders Make an Impact?

The Dow Jones was 20 points lower on Tuesday after the company in charge of the index announced a reshuffle in the wake of Apple’s pending stock split. Apple shares will split 4:1 on August 31st and S&P Dow Jones Indices saw that move reducing the weighting of technology in the index.

The shake-up means that the longest-serving member of the Dow, oil giant Exxon Mobil is out, including Raytheon Technologies and Pfizer. Taking their place will be Salesforce, Honeywell, and biotech firm Amgen.

U.S. durable goods orders

Ahead of today’s market open will be U.S. durable goods orders. Released by the U.S. Census Bureau, the indicator tracks the cost of orders received by manufacturers. The headline figure was up 7.6% in June and July is expected to see a fall to 4.3%.

Source: Economic Calendar

Once the durable goods numbers are out, attention will turn to the Federal Reserve’s annual Jackson Hole economic symposium. The two-day event features Federal Reserve officials and finance ministers from around the world. The topic of discussion at this year’s event will be economic and monetary theory for the next decade. This becomes more important in light of the current economic backdrop and the event can see market volatility due to financial news outlets running interviews with the attendees.

This year’s event is being run virtually, yet there should still be some interesting statements to come from delegates and the market will be keen to compare those statements with their current expectations for recent economic talking points, such as the Federal Reserve balance sheet, inflation and yield curve control.

Dow Jones Technical Outlook

The dip on Tuesday saw the Dow Jones close at 28,248 and the price is still staying ahead of an uptrend line which runs from support on April 2nd. Price threatened to break lower on July 30th but has managed to hold the uptrend. The next target for the upside is the February all-time high at 29,530. This could be hit this week if the Federal Reserve signalled a more accommodative stance in the years ahead. A break lower would take out the uptrend again and target the 27,568 support level, which was the high of 8th June and provided buy support last week.

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