NASDAQ Index, SP500, Dow Jones Forecasts – Major Indices Rebound From Session Lows After FOMC Minutes

Key Insights

• FOMC Minutes reveal Fed’s heightened concerns over inflation’s significant upside risks.
• Despite inflationary risks, Fed remains optimistic, seeing reduced 2023 recession chances.
• Today’s reports: Building Permits up 0.1%; Housing Starts rise by 3.9% in July.

SP500

SP500 settled near the support at 4430 as traders reacted to the FOMC Minutes. The FOMC Minutes indicated that Fed members remained worried about inflation and continued to see significant upside risks to inflation. Such risks could require further tightening of monetary policy. Importantly, the Fed does not expect a recession in 2023. According to the FOMC Minutes, the probability of avoiding a recession through 2024 grew noticeably. Today, traders also had a chance to take a look at Building Permits and Housing Starts reports. Building Permits increased by 0.1% month-over-month in July, while Housing Starts grew by 3.9%. Industrial Production increased by 1%, compared to analyst consensus of +0.3%.

SP500 continues its attempts to settle below the support in the 4430 – 4450 range. In case these attempts are successful, SP500 will head towards the next support level in the 4335 – 4350 range.

NASDAQ

NASDAQ remains under pressure as the pullback continues. Traders want to see additional bullish catalysts in order to push NASDAQ back towards recent highs.

Meanwhile, NASDAQ is slowly moving towards the next support level, which is located in the 14,560 – 14,680 range. RSI remains in the moderate territory, so there is plenty of room to gain additional downside momentum.

Dow Jones

Dow Jones settled below the 35,000 level, driven by the pullback in Intel stock. Other components of the Dow Jones index showed mixed dynamics in today’s trading session.

In case Dow Jones settles below the 200 MA at 34,925, it will move towards the support level in the 34,500 – 34,600 range.

For a look at all of today’s economic events, check out our economic calendar.