NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Retreats As Qualcomm Dives 12%

SP500 Rebounds From Session Lows As Traders Buy The Dip

SP500 pulled back as traders reacted to CPI report. The report indicated that Inflation Rate increased from 3.3% in March to 3.8% in April, compared to analyst consensus of 3.7%.

Core Inflation Rate grew from 2.6% to 2.8%, compared to analyst forecast of 2.7%. Rising gasoline and grocery prices pushed inflation towards higher levels. As a result, Inflation Rate reached levels that were last seen back in 2023.

Treasury yields moved higher as traders bet that Fed could be forced to raise rates due to rising inflation. The yield of 30-year Treasuries crossed the important 5.00% level. A move above the 5.00% level may signal that the bond market is ready for a sell-off, which could put material pressure on stocks.

Oil prices rallied as U.S. – Iran negotiations stalled. Iran is not ready to give up its nuclear program and wants to maintain control over the Strait of Hormuz. U.S. has rejected Iran’s latest offer, and traders try to evaluate whether U.S. and Israel are ready to restart the military operation in the Middle East. Rising geopolitical risks pushed WTI oil prices above the $102.00 level.

Healthcare and consumer defensive stocks were among the biggest gainers today amid rising demand for safe-haven assets. Energy stocks gained ground as traders focused on the rally in the oil markets. Tech stocks found themselves under pressure as traders rushed to take profits after the release of inflation data.

It should be noted that traders used the pullback as an opportunity to buy stocks, so SP500 managed to rebound from session lows. Currently, SP500 is trying to settle back above the 7400 level. In case this attempt is successful, SP500 will head towards the nearest resistance level at 7425 – 7435.

NASDAQ Moved Away From Historic Highs Amid Profit-Taking

NASDAQ pulled back amid profit-taking in the tech sector, which was triggered by the CPI report. Qualcomm, which was down by 12%, was the worst performer in the NASDAQ index today. The stock suffered a strong sell-off as traders rushed to take profits after the strong rally.

Intel, Western Digital, Micron and other stocks in the tech sector have also found themselves under strong pressure in today’s trading session.

The nearest support level for NASDAQ is located in the 28,500 – 28,550 range. If NASDAQ declines below the 28,500 level, it will head towards the 50 MA at 28,377. A move below the 50 MA will open the way to the test of the support at 28,100 – 28,150.

On the upside, a move above the 29,000 level will push NASDAQ towards the nearest resistance at 29,200 – 29,250.

Dow Jones Is Flat Amid Rising Demand For Safe-Haven Assets

Dow Jones is mostly flat, supported by rising demand for defensive sectors. Unitedhealth Group and Walmart are the biggest gainers in the Dow Jones index today.

From the technical point of view, Dow Jones continues its attempts to settle above the resistance at 49,700 – 49,800. If Dow Jones manages to settle above the 49,800 level, it will move towards the psychologically important 50,000 level. A successful test of the 50,000 level will push Dow Jones towards the resistance at 50,400 – 50,500.

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