- The Dow Jones Industrial Average rose in its recent trading at intraday levels, achieving its largest daily rise in more than three months.
- The index closed with a gain of 2.66%, equivalent to 765.38 points, to settle at the end of trading at 29,490.90.
- This happened after its decline during trading Last Friday, as it fell by -1.71%. It went down during last week’s trading by -2.92%, which is the third week in which the index declined in a row.
In economic news, the Institute for Supply Management's manufacturing index fell to 50.9 in September from 52.8 in August. It was below expectations for an unchanged reading in a Bloomberg survey.
Analysts say the Fed's tight monetary policy will continue to dampen demand and create major headwinds for the manufacturing sector.
The supplier delivery index fell to 52.4 from 55.1, the lowest level since December of 2019. The price gauge fell to the lowest reading since June of 2020.
As a result, Treasury yields fell, which helped increase the attractiveness of stocks at the beginning of the last quarter of the year. It also was helped by the fact that British Prime Minister Liz Truss was forced to reverse course on the highest rate tax cut, which caused tension in stock and currency markets globally during previous days.
Dow Jones Technical Analysis
Technically, with its recent rise the index is trying to compensate for part of what it incurred from previous losses. At the same time, it is trying to dispose of some of its clear oversold state, with the relative strength indicators. This is especially true with the influx of positive signals from them, considering the dominance of the short-term corrective bearish trend along minor and major slope lines. This is shown in the attached chart for a period (daily), with the continued negative pressure of its trading below the simple moving average for the previous 50 days.
To retest the pivotal 29,653.30 resistance level with its recent rise, which in the event of its stability will force the index to rebound lower again during its upcoming trading, to target the 28,402.50 support level.
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