Dow Jones Futures Retreat As Traders Looking for Fresh Catalyst

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The Dow Jones futures give up 70 points after yesterday’s gains and investors digest the corporate earnings that for now have come above the expectations. Nasdaq yesterday hit another record high boosted by Microsoft and Apple, while stocks in Asia finished over 2% higher.

Momentum boosted yesterday as the ISM Manufacturing PMI came at 54.2 beating the forecasts of 53.6 in July. The New Orders Index reported in at 61.5, also above expectations of 46.8. However, the Manufacturing Employment Index came in at 44.3 below the estimates of 48.3.

Investors keep an eye on the negotiations in Washington over a new relief package as the previews package expires this week.
In corporate news, Alphabet borrowed $10 billion, which is the largest-ever bond issue. Alphabet’s debt offering includes $1 billion in 5-year debt at a coupon rate of just 0.45%. Amazon said that the FCA gave the green light to proceed with acquiring a 16% stake in the food delivery company Deliveroo.

Dow Jones futures are 0.34% lower at 26,468. The S&P 500 futures are 0.44 lower at 3,274, while Nasdaq futures are 0.41% lower at 10,998.

Dow Jones Index Technical Analysis    

Dow Jones index finished yesterday 0.89% higher at 26,664 as it managed to rebound from the 200-day moving average that proved strong support since July 13. So the first target for bearish traders is a break below 26,226 -200-day SMA – first and then a break below 26,126 the 50-day moving average. Below those support levels, the next target for bears is the low from July 9 at 25,503.  

On the upside, yesterday’s high at 26,707 is the first obstacle. The next resistance stands at 26,958 the top from July 23. More selling pressure expected at 27,349 the high from June 10. 

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