NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Retreat As Traders Prepare For U.S. – China Trade War

SP500

SP500 is under strong pressure as U.S. President Donald Trump said that he could impose massive tariffs on China. U.S. – China relations are under strong pressure agina as China has suddenly introduced export controls on rare earths. Trump and China’s Xi were expected to meet at APEC in South Korea in just two weeks, but now this meeting is under question. Traders worry that U.S. and China will enter into a new phase of the trade war, which will put material pressure on global economy. Today, traders also had a chance to take a look at the Michigan Consumer Sentiment report for October. The report indicated that Consumer Sentiment declined from 55.1 to 55.0, compared to analyst forecast of 54.2. The report did not have a material impact on market dynamics as traders focused on Trump’s comments. The pullback was broad, and most marekt sectors moved lower in today’s trading session. However, consumer defensive stocks managed to gain some ground amid rising demand for safe-haven assets.

Currently, SP500 is trying to settle below the support at 6610 – 6620. In case this attempt is successful, it will head towards the next support level at 6530 – 6540.

NASDAQ

NASDAQ suffered a sell-off as traders rushed to sell tech stocks amid trade war fears. Traders worry that potential tariffs and counter-tariffs could trigger a strong pullback in the equity markets.

A successful test of the support at 24,350 – 24,400 will open the way to the test of the next support level at 23,950 – 24,000.

Dow Jones

Dow Jones tests new lows as traders focus on recent developments in U.S. – China relations.

A move below the support at 45,700 – 45,800 will push Dow Jones towards the next support level, which is located in the 45,000 – 45,100 range.

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