Global stocks are rallying today as traders hope for clarity as the US goes to its general election. In the United States, the Dow Jones has added more than 160 points in the futures market, a day after it gained more than 400 points. S&P 500 and Nasdaq 100 futures are also in the green.
In Asia, all major indices are rallying also. Elsewhere, In Hong Kong, the Hang Seng added more than 465 points while in China, the Shanghai composite rose by more than 1.45%. In Japan, the Nikkei 225 was closed today as the country marked the culture day.
The bullish trend is also happening in Europe, where futures tied to the DAX index and FTSE 100 index are rallying.
In general, most investors are looking for clarity as the US goes to its general election. Regardless of who wins, traders hope that a new normal will happen. In case Trump wins, investors are pricing-in status quo, with low taxes, deregulation, and trade wars. If Biden wins, investors believe that more regulations, higher taxes, and better relations with other countries,
In addition, investors are paying close attention to the rising number of Covid-19 cases in Europe and the US. These cases have pushed several countries like Portugal, Austria, UK, and Germany to implement more lockdowns.
Later today, the main indices will react to corporate earnings. In the UK, the FTSE 100 will react to earnings from Associated British Foods. In Germany, the market will react to earnings from Bayer, the chemicals company. Across Europe, other earnings to watch out today will be from Pandora, BNP Paribas, and AXA.
In the United States, the Dow Jones and other indices will react to earnings from PayPal, Humana, Ferrari, and Hilton.
Looking at the economic calendar, there will be no major economic numbers today. Still, investors will focus on Eurogroup meetings, Switzerland inflation numbers, and US durable goods data.
Dow Jones technical outlook
On the four-hour chart, we see that the Dow Jones has moved from a low of $26,060 on October 30 to today’s high of $27,166. Yesterday, the index managed to move above the 15-day and 25-day moving averages, which is a signal that buyers are now in control. Further, it has moved above the important resistance level of $26,550, which is the September 25 low.
Therefore, ahead of the US election, I expect that bulls will remain in control and push it higher. The potential target will be $27,361. On the other hand, the support for this trade will be $26,550.
Dow Jones technical chart