Nasdaq Index, Dow Jones, S&P 500 News: Wall Street Cautious Amid Surging Yields, Middle East Tensions

Highlights

• Powell’s remarks add market uncertainty
• Treasury yields hit 16-year high
• 10-year Treasury yield breaches psychological 5% level
• Middle East tensions escalate

U.S. Stocks React to Powell and Geopolitics

Major U.S. stock indexes are dipping as traders evaluate Federal Reserve Chair Jerome Powell’s remarks on persistent inflation and a likely hold on interest rates in November. Treasury yields are surging, crossing the 5% mark for the first time since 2007. Concurrently, geopolitical tensions are rising. Israel is on high alert due to potential conflict escalation with Hamas, while the U.S. and other nations have urged their citizens to leave Lebanon.

Market Indicators and Federal Reserve

The Dow Jones, S&P 500, and Nasdaq have all opened lower, with the tech-heavy Nasdaq suffering the most significant decline. On the weekly scale, all three indexes are poised for losses. Powell’s speech on Thursday confirmed the Fed’s commitment to controlling inflation but offered no clear path for future rate hikes. Market sentiment appears to be pricing in a hold on rate changes for November.

Geopolitical Unrest in the Middle East

Israel has ordered an evacuation in Kiryat Shmona near the Lebanon border due to intensifying shelling and escalating tensions with Hezbollah. The evacuation adds another layer of uncertainty to global markets, already concerned with the Israel-Hamas conflict. Multiple nations have called on their citizens to leave Lebanon.

Corporate Earnings and Market Moves

Various stocks are also moving premarket, with SolarEdge Technologies’ shares plunging after revising its third-quarter guidance. Meanwhile, Schlumberger and Intuitive Surgical reported mixed earnings, affecting their stock prices. These corporate earnings further contribute to market volatility.

Short-Term Outlook

Given Powell’s cautious stance and the rising geopolitical tensions, market sentiment is bearish. Traders are also keeping an eye on corporate earnings, adding another element of unpredictability.

Technical Analysis

The current daily price of the S&P 500 Index is 4265.03, slightly below its 50-day moving average of 4233.34 but above its 200-day moving average of 4177.26. This indicates short-term volatility but longer-term stability.

The price is hovering above the main support level at 4197.68 but below the minor resistance level at 4327.18, suggesting a trading range scenario. Given that the price is near the minor support at 4261.72, it serves as a crucial pivot point for traders.

Overall, early market sentiment is neutral to bearish with traders keying on the market’s reaction to the 200-day moving average. There could be a techniclal bounce on the first test of this level, but if it fails then look for the selling to possibly lead to the start of an acceleration to the downside.