NASDAQ Index, SP500, Dow Jones Forecasts – Stocks Move Lower As Traders Are Cautious After CPI Report

SP500

SP500 pulled back as traders reacted to U.S. inflation reports. Inflation Rate declined from 2.5% in August to 2.4% in September, while Core Inflation Rate increased from 3.2% to 3.3%. Rising Core Inflation Rate was a bearish catalyst for SP500 as chances for aggressive rate cuts declined. The Initial Jobless Claims report also had a material impact on market dynamics. Initial Jobless Claims increased from 225,000 to 258,000. Rising Initial Jobless Claims may signal that economy is slowing down. The pullback was broad, and most market segments found themselves under pressure. Energy and basic materials stocks gained ground as traders focused on the rally in commodity markets, which was triggered by rising tensions in the Middle East.

In case SP500 settles below 5775, it will head towards the nearest support level, which is located in the 5735 – 5750 range. On the upside, SP500 needs to climb above the resistance at 5800 – 5810 to gain additional momentum.

NASDAQ

NASDAQ moved lower as traders took some profits off the table near multi-week highs. It should be noted that the pullback is not strong as general market sentiment remains bullish.

A move below the support at 20,000 – 20,100 will push NASDAQ towards the next support level, which is located in the 19,500 – 19,600 range.

Dow Jones

Dow Jones is moving lower amid broad pullback in the equity markets. Only five stocks in the Dow Jones index managed to gain some ground in today’s trading session.

The nearest support level for Dow Jones is located in the 42,100 – 42,200 range. A successful test of this level will open the way to the test of the next support at 41,300 – 41,400. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in case the right catalysts emerge.

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