Dow Jones Will Extend Recovery On Strong ADP and Coronavirus Vaccine News
Dow Jones futures continue higher for the third day in a row adding 0.72% at 28997. Yesterday the Dow Jones Industrial Average started with a gap up and ended 1.44% higher at 28807. The strong settlement in Wall Street, helped also the Asian and European stocks today. Early morning rumours that a coronavirus vaccine may be close for testing on animals and then humans lifted investors sentiment. Scientists in the UK said that they made a critical breakthrough by reducing a part of the average development time of the coronavirus from “two to three years to just 14 days”. While animal testing may start immediately, human testing may not begin until early summer. At the same time the Chinese TV reported that a research team at Zhejiang University has found an effective drug to treat coronavirus infected people.
On the economic data, the United States ADP Employment Change smashed expectations. The employment in the private sector rose 291K more than the expectations of 156K.
Investor sentiment also helped from the PBOC intervention. The central bank of China injected liquidity to markets to ease the negative impact of coronavirus outbreak.
In Wall Street the Nasdaq futures are 0.99% higher at 9448 while the S&P 500 futures are 0.77% higher at 3325. Tesla yesterday impressed investors adding over 13% at $887 but below the daily high at $960. Today in pre-market trading Tesla is 2.15% lower at $868.
Dow Jones strong rebound yesterday brought back the bulls in the driver’s seat. On the upside, initial resistance for the Dow Jones index will be met at 28,906 the high from yesterday’s trading session. Next resistance will be met at 29285 the high from January 24th.
On the other hand, immediate support for the Dow Jones stands at 28696 the low from yesterday’s trading session. If the Dow Jones breaks below, then the next support stands at 28464 the 50-day moving average.