NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Pull Back As Traders Sell The News

SP500

SP500 pulled back as traders reacted to Fed decision and Powell’s comments. The Fed cut the interest rate from 4.50% to 4.25%, in line with analyst estimates. In the FOMC Statement, Fed noted that the decision was made “in light of the shift in the balance of risks”, which meant that the central bank was worried about the slowdown of the job market. The federal funds rate projection for 2025 was changed from 3.9% to 3.6%, while PCE inflation projection remained unchanged at 3.0%. The next year’s federal funds rate projection was cut from 3.6% to 3.4%, while PCE inflation projection was raised from 2.4% to 2.6%. This move indicates that Fed is ready to tolerate higher inflation in order to keep the labor market in decent shape. During his press conference, Powell noted that he was in no rush to cut rates at a robust pace, which had a negative impact on stock market dynamics.

SP500 failed to settle above the resistance at 6610 – 6620 and is moving towards the nearest support level, which is located in the 6550 – 6560 range. A move below 6550 will push SP500 towards the next support at 6480 – 6490.

NASDAQ

NASDAQ is under pressure as NVIDIA is down by 3.4%. The stock is losing ground amid reports indicating that China banned purchases of NVIDIA chips for its tech companies.

The nearest support level for NASDAQ is located in the 23,950 – 24,000 range. In case NASDAQ declines below the 23,950 level, it will head towards the next support at 23,700 – 23,750.

Dow Jones

Dow Jones moved away from session highs amid broad pullback in the equity markets. From a big picture point of view, traders “sell the news” and take some profits off the table near historic highs.

A successful test of the support at 45,700 – 45,800 will push Dow Jones towards the next support level at 45,000 – 45,100.

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