- The Dow Jones Industrial Average continued to rise in its recent trading on the intraday levels, to achieve gains for the fourth day in a row by 0.33%.
- It added to the index about 112.64 points. It then settled at the end of trading at the level of 34,302.61, after its rise in Thursday’s trading by 0.64%, during the week.
- In the past, the index recorded gains of 2%, marking its best week since November.
Companies began reporting their results for the fourth quarter of 2022, and the start was, as usual, from major banks, which have not presented any major surprises so far. Market analysts will closely monitor this quarter's earnings reports in search of indications of the readiness of the largest US companies for the expected economic downturn driven by rising interest rates.
Among the banks to report was JPMorgan JPM, which was the best performer in the Dow Jones Industrial Average, as its shares closed up 2.5%.
In early trading of the session, investors had a weak reaction to these reports, focusing on higher expenses and provisioning losses along with a cautious outlook, however, the stocks reversed course during the day and eventually closed higher.
Meanwhile, the University of Michigan Consumer Sentiment Index rose in January to its highest level in nine months, as expectations for the inflation rate were after a mild year.
Earlier this week stocks got a boost from the release of consumer price data, which showed a slowdown as expected in annual inflation. Investors are betting that this will allow the Federal Reserve to raise interest rates by only 25 basis points at the next policy meeting.
Dow Jones Technical Outlook
- The index continues to rise, supported by positive signals in the relative strength indicators.
- This is despite reaching highly overbought areas, in addition to the continuation of positive pressure for its trading above its simple moving average for the previous 50-day period.
- It was also affected by the breach of a bearish corrective slope line earlier in the short term, as shown in the attached chart for a (daily) time period, to attack the important resistance level 34,281.36 in turn.
Therefore, our expectations indicate that the index will continue to rise during its upcoming trading, especially if it breaches the resistance 34,281.36, to then target directly the first resistance levels at 35,492.00.
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