NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Move Higher As Inflation Expectations Drop

Key Insights

• SP500 made an attempt to settle above the 4600 level but lost momentum and pulled back. 
• NASDAQ gains some ground as demand for AI-related stocks stays strong. 
• Dow Jones climbed back above the 36,000 level as traders reacted to Michigan Consumer Sentiment report. 

SP500

SP500 remains stuck below the 4600 level as traders react to job market data and Michigan Consumer Sentiment report. Non Farm Payrolls report indicated that the economy added 199,000 jobs in November, compared to analyst consensus of 180,000. Unemployment Rate declined from 3.9% in October to 3.7% in November, while analysts expected that it would remain unchanged. Participation Rate increased from 62.7% to 62.8%, while Average Weekly Hours grew from 34.3 to 34.4. Michigan Consumer Sentiment  increased from 61.3 in November to 69.4 in December, exceeding analyst expectations. The report showed that year-ahead inflation expectations declined from 4.5% to 3.1%, which may have a material impact on Fed policy. Energy stocks are among the leaders in SP500 today as traders react to the rebound in the oil markets. Utilities and Real Estate stocks have found themselves under pressure as traders focused on rising Treasury yields.

The technical picture has not changed in recent trading sessions. SP500 needs to settle above the key 4600 level to gain additional momentum and move towards the next resistance, which is located in the 4730 – 4750 range.

NASDAQ

NASDAQ continues its attempts to settle above the important 16,000 level. Michigan Consumer Sentiment report provided some support to NASDAQ, but it remains to be seen whether it will be able to gain sustainable upside momentum ahead of the weekend. Advanced Micro Devices and NVIDIA are among the best performers in the NASDAQ index today as demand for AI-related stocks remains strong.

If NASDAQ stays above the 16,000 level, it will move towards the nearest resistance at 16,400 – 16,500.

Dow Jones

Dow Jones is slowly moving higher, led by Intel stock, which is up by 1.5%. Intel is moving higher amid rising demand for tech stocks.

From the technical point of view, Dow Jones did not manage to settle below the 36,000 level and is moving towards the nearest resistance at 36,350 – 36,500.

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