Nasdaq 100, Dow Jones, S&P 500 News: Tesla’s Winning Streak Propels Market Sentiment Higher

Market Sentiment Mixed Amid Economic Data and Holiday-Shortened Session

U.S. stocks traded near the flatline in Wednesday’s shortened session as traders digested mixed economic data. The New York Stock Exchange closed early at 17:00 GMT and will remain shut on Thursday for Independence Day.

At 15:23 GMT, the Dow is trading 39287.64, down 44.21 or -0.11%. The S&P 500 Index is at 5522.49, up 13.48 or +0.24% and the Nasdaq 100 is trading 18112.32, up 83.56 or +0.46%.

Economic Indicators Show Softening

June’s economic data painted a picture of a cooling economy. ADP reported private payroll growth below expectations, while weekly jobless claims came in higher than forecast. The Institute for Supply Management’s services PMI unexpectedly contracted, registering 48.8% against an anticipated 52.8%.

Tesla Rally Continues

Tesla’s stock maintained its upward momentum, heading for its seventh consecutive positive session – the longest winning streak of 2024. This rally has contributed to a bullish tone in the broader market, according to Larry Tentarelli, chief technical strategist at Blue Chip Daily Trend Report.

Sector Performance Varied

The market saw mixed sector performance. Leisure and hospitality led job gains, followed by construction and professional services. Technology stocks, particularly in the electric vehicle space, showed strength. However, the unexpected contraction in the services sector weighed on related stocks.

Bond Yields Decline

A drop in bond yields provided some support to equities. This decline comes as investors await the release of minutes from the Federal Reserve’s June meeting, due an hour after Wednesday’s closing bell.

Labor Market Shows Signs of Cooling

The Labor Department reported initial jobless claims rose to 238,000 for the week ending June 29, surpassing estimates. Continuing claims increased to 1.858 million, the highest level since November 2021. Additionally, ADP’s report showed private payrolls increased by only 150,000 in June, below the expected 160,000.

Market Forecast

Despite mixed signals, the market outlook remains cautiously optimistic. Jim Paulsen, author of “Paulsen Perspectives,” suggests that if the Federal Reserve eases its monetary policy, it could trigger a broader rally. He notes that the current bull market is unique, having existed entirely under tightening Fed conditions.

As traders look ahead to Friday’s crucial June jobs report, the market appears poised for potential gains. However, much depends on upcoming economic data and the Fed’s future policy decisions. The short-term outlook leans slightly bullish, contingent on positive surprises in employment figures and any indications of a less hawkish Fed stance.

Technical Analysis