NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Rallies As Western Digital Soars 15%

SP500 Tests New Highs As U.S. And Iran Reach A Deal

SP500 rallied as traders reacted to the U.S. – Iran deal, which will be signed in Switzerland on Friday. The Strait of Hormuz would be reopened and the naval blockade of Iranian ports would be lifted.

It should be noted that the interim peace deal does not address Iran’s nuclear program, which will be discussed later. However, markets ignore this issue and focus on the reopening of the Strait of Hormuz. Oil prices are down by -4% as traders react to the deal.

Treasury yields moved lower as bond traders focused on the sell-off in the oil markets. The yield of 2-year Treasuries declined towards the 4.06% level, while the yield of 10-year Treasuries settled near 4.47%. Falling Treasury yields provided additional support to SP500.

Traders also focused on the NAHB Housing Market Index report for May. The report indicated that NAHB Housing Market Index decreased from 37 in May to 35 in June, compared to analyst forecast of 36. The report showed that 35% of builders cut prices, compared to 32% in May. The average price reduction was 6% in June.

Industrial Production increased by +0.1% month-over-month in May, compared to analyst consensus of +0.3%. NY Empire State Manufacturing Index decreased from 19.60 in May to 5.70 in June, while analysts expected that it would drop to 14. Weaker-than-expected reports did not put pressure on SP500 as traders have focused on geopolitical developments.

Industrials and tech stocks were among the biggest gainers in the SP500 index today. Not surprisingly, energy stocks found themselves under pressure as traders focused on the sell-off in the oil markets. Real estate, consumer defensive, and healthcare stocks have also moved lower as demand for safe-haven assets declined.

Currently, SP500 is trying to settle above the resistance at 7540 – 7550. In case this attempt is successful, SP500 will head towards the next resistance level, which is located in the 7615 – 7625 range. RSI is close to the overbought territory, but there is enough room to gain additional momentum in the near term.

NASDAQ Rallies As Traders Rush To Buy AI-Related Stocks

NASDAQ soared amid strong demand for AI – related stocks. Western Digital, which was up by +15%, was the biggest gainer in the NASDAQ index today.

NASDAQ moved above the resistance at 30,250 – 30,300 and is trying to settle above the 30,600 level. If NASDAQ manages to settle above 30,600, it will head towards the next resistance at 30,750 – 30,800.

Dow Jones Tests Historic Highs

Dow Jones gained upside momentum amid broad rally in the equity markets, which was triggered by the U.S. – Iran peace deal. Boeing, which was up by +5.4%, was the biggest gainer in the Dow Jones index today. The stock rallied as traders focused on the sell-off in the oil markets.

From the technical point of view, Dow Jones attempts to settle above the resistance at 51,600 – 51,700. If Dow Jones manages to settle above the 51,700 level, it will get to the test of the 52,000 level. A move above 52,000 will open the way to the test of the 52,500 level. RSI remains in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

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