NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Tests New Highs As Micron Soars 21.5%

SP500 Gains Ground As Traders React To Recent Developments In The Oil Markets

SP500 gained ground but moved away from session highs as traders reacted to the rebound in the oil markets. WTI oil made an attempt to settle above the $94.00 level as U.S. and Iran exchanged strikes. Comments from U.S. and Iranian officials suggest that the ceasefire remains intact despite these incidents. However, traders are worried that U.S. and Iran will not reach a deal anytime soon, which is bullish for oil markets. Rising oil prices are bearish for stocks as Fed may be forced to raise rates to fight inflation.

Today, traders also focused on the CB Consumer Confidence report. The report indicated that CB Consumer Confidence declined from 93.8 in April to 93.1 in May, compared to analyst forecast of 92.

Case-Shiller Home Price index report indicated that home prices increased by +0.8% year-over-year in March, compared to analyst consensus of +1%. Dallas Fed Manufacturing Index improved from -2.3 in April to +0.4 in May, compared to analyst forecast of -1.

Basic materials stocks were among the biggest gainers today despite the pullback in precious metals markets. Industrials and technology stocks have also managed to gain solid upside momentum.

Energy stocks found themselves under pressure as traders reacted to yesterday’s sell-off in the oil markets. Today’s rebound did not provide sufficient support to energy stocks.

SP500 failed to settle above the 7550 level and pulled back towards the 7515 level. In case SP500 settles below 7515, it will head towards the 50 MA at 7449. A move below the 50 MA will open the way to the test of the support at 7425 – 7435.

NASDAQ Tests Historic Highs Amid Strong Demand For AI Stocks

NASDAQ tested new highs amid strong demand for tech stocks. The rally continues despite worries about Fed policy outlook as traders are focused on AI.

Micron, which is up by 21.5%, is the biggest gainer in the NASDAQ index today. The stock rallied as UBS raised its price target from $535 to $1625. UBS believes that long-term contracts would stabilize Micron’s earnings profile and ensure that the company is extremely profitable in the long run.

NASDAQ settled above the resistance at 29,700 – 29,750 and is trying to settle above the psychologically important 30,000 level. In case this attempt is successful, NASDAQ will head towards the 30,500 level. RSI is close to the overbought territory, but there is enough room to gain additional upside momentum in the near term.

Dow Jones Tests Support At 50,400 – 50,500

Dow Jones is losing ground amid falling demand for healthcare and consumer stocks. Chevron, which is down by 3.5%, is the worst performer in the Dow Jones index today. The stock is under pressure as traders focus on the recent pullback in the oil markets.

From the technical point of view, Dow Jones attempts to settle below the support at 50,400 – 50,500. In case this attempt is successful, Dow Jones will head towards the 50 MA at 50,034. A move below the 50 MA will open the way to the test of the next support at 49,700 – 49,800.

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