NASDAQ Index, SP500, Dow Jones Forecasts – NASDAQ Retreats As Apple Falls

Key Insights

• SP500 pulled back as traders reacted to the disappointing Manufacturing PMI report. 
• NASDAQ found itself under strong pressure amid profit taking in chip stocks. 
• Dow Jones moved higher as healthcare stocks rallied. 

SP500

SP500 is losing ground as traders continue to take profits at the start of the new year. Today, S&P Global released the final reading of the Manufacturing PMI report, which showed that Manufacturing PMI declined from 49.4 in November to 47.9 in December. The report missed analyst expectations and served as an additional bearish catalyst for SP500. Treasury yields were moving higher, putting additional pressure on equity markets. It should be noted that the pullback was mostly driven by tech stocks, so the general market sentiment was not too bearish.

Currently, SP500 is trying to settle below the support at 4730 – 4750. In case this attempt is successful, SP500 will move towards the next support level, which is located in the 4575 – 4600 range. There are no material levels between 4600 and 4730, so SP500 will have a good chance to gain strong downside momentum in case it settles below 4730.

NASDAQ

NASDAQ tested new lows as Apple declined by 3.6%. Barclays downgraded the stock as it believes that iPhone sales will stay weak. Advanced Micro Devices, which was down by 5.6%, was the worst performer in the NASDAQ index today. Investors who wanted to sell the stock but did not do this for tax reasons rushed to sell AMD during the first trading session of the year.

NASDAQ is heading towards the support at 16,400 – 16,500. A move below 16,400 will push NASDAQ towards the next support at 15,800 – 15,900.

Dow Jones

Dow Jones gained some ground due to the strong performance of healthcare stocks. The rallies in AMGEN and Merck stocks offset the weakness of Intel and Apple stocks.

RSI remains in the moderate territory, so Dow Jones has a decent chance to settle above the recent highs near the 37,800 level.

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