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Brief: Dow Jones Retreats as DXY, FTSE 100 Rises After Upbeat Barclays Earnings

Rates

Global stocks are mixed today as traders react to overnight debate between Donald Trump and Biden, corporate earnings, and the rising number of Covid-19 cases in Europe. In the United States, Dow Jones, S&P 500, and Nasdaq 100 futures are down by more than 0.20% as the US dollar index (DXY) rise by 0.15%.

In Europe, FTSE 100 futures are pointing upwards while the DAX index and CAC 40 index are down by 0.50% and 0.10%, respectively. Similarly, in Asia, the Nikkei 225 and Hang Seng are up by about 0.10%.

In the UK, the FTSE 100 is reacting to the strong earnings from Barclays and the upbeat retail sales numbers. In its report, Barclays announced that it made a net profit of more than £797 million. That was more than double the £273 million that analysts were expecting.

Its revenue rose to £5.2 billion while common equity tier one capital jumped to 14.6%. Other banks like UBS, Credit Suisse, and JP Morgan have recently reported better earnings.

The FTSE 100 is also reacting to the relatively strong retail sales from the UK. The numbers showed that retail sales rose by 4.7% in September while the core sales rose by 6.4%.

Meanwhile, in the United States, the muted action in the Dow Jones and other indices is because investors are trying to digest the final debate between Trump and Biden. Recent polls have shown that Joe Biden has an upper hand ahead of the upcoming election.

Later today, the companies that will publish their earnings are American Express, Illinois Tool Works, Ventas, and Royal Caribbean. Also, investors will react to the preliminary PMI numbers from the US.

Dow Jones technical outlook

The four-hour chart shows that the Dow Jones is under pressure. The index is trading at $28322, which is slightly below yesterday’s high of $28,437. The price is slightly above the 61.8% Fibonacci retracement and is also slightly below the 25-day and 50-day moving averages. It also seems to be forming a bullish pennant pattern after the yesterday’s rally.

Therefore, I suspect that the price will continue rising as bulls remain optimistic about US earnings. On the flip side, a move below the support of $28,150 will invalidate this trend.

Dow Jones technical chart

Dow Jones