After tapping record highs, the Dow Jones Industrial Average Index pared some of its gains from Wednesday’s trading when it finished in the red yesterday. The index was down to 27,782.0 which was 1.6 points or 0.01% lower from 27,783.6.
There have been no new updates on the US-China negotiations which may have dampened sentiment. White House Chief Economic Adviser Larry Kudlow said that they are “getting close” to a trade deal. However, they still need to work on resolving issues regarding farm purchases. It also did not help the Dow that unemployment claims rose to their highest levels since June at 225,000 and were higher than the market consensus for 215,000.
The Dow could benefit from the pick up in risk appetite in today’s Asian session. News about China’s central bank, the People’s Bank of China (PBoC), taking a more active role in supporting economic growth seemed enough to convince investors to bargain hunt in Asian equity markets. If risk appetite is sustained in today’s trading, the Dow could find its way back to its record-highs around 27,783.59.
There are also consumer spending reports from the US due today. At 1:30 pm GMT, the headline retail sales report for October is estimated to show a 0.1% uptick. Meanwhile, excluding big ticket purchases, the core retail sales report is eyed to come in at 0.3%. Positive figures will likely be bullish for the US dollar because they would affirm the Federal Reserve’s optimism on the economy.
If the numbers disappoint, we could see the Dow re-test the area around 27,592.30 where it previously made lows.Download our latest quarterly market outlookfor our longer-term trade ideas.
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