NASDAQ Index, SP500, Dow Jones Forecasts: Wall Street Bounces Back Amid Rate Cut Speculations

Key Insights

• U.S. stock futures rebound: Dow Futures up 0.4%, S&P 500 Futures up 0.4%, Nasdaq 100 Futures up 0.7%.
• Wednesday’s decline halts winning streaks; Nasdaq, Dow, and S&P 500 fall 1.5%, 1.3%, and 1.5%.
• Positive market sentiment fueled by Treasury yield drop and Fed rate cut expectations.
• Micron Technology’s upbeat forecast and upcoming Nike earnings influence investor outlook.
• Philadelphia Fed President Harker signals openness to rate cuts, bolstering market optimism.

Quick Fundamental Outlook

U.S. stock futures experienced a rebound on Thursday, driven by declining Treasury yields and Micron’s optimistic outlook. The Dow Futures rose by 0.4%, S&P 500 Futures by 0.4%, and Nasdaq 100 Futures by 0.7%.

This uptick follows a significant drop on Wednesday, with the Nasdaq Composite, Dow Jones Industrial Average, and S&P 500 falling by 1.5%, 1.3%, and 1.5% respectively, halting their nine-day winning streaks. Despite this, December and yearly gains remain strong, fueled by expectations of Federal Reserve rate cuts in the new year.

The 10-year U.S. Treasury yield hit a seven-month low, reinforcing rate cut bets, with a more than 68% chance of a 25 basis point cut by March. Philadelphia Fed President Patrick Harker’s comments supported these expectations.

Additionally, Micron Technology’s positive revenue forecast and upcoming Nike earnings after market close are anticipated to impact investor sentiment, along with potential media company mergers involving Warner Bros Discovery and Paramount Global.

SPX SP500 Prices Forecast

The S&P 500 Index (SPX) experienced a downturn, declining 1.47% to close at 4,352.52. It is currently navigating below a pivotal resistance at $4,763, with subsequent hurdles at $4,836 and $4,900.

On the downside, immediate support forms at $4,686, with further cushions at $4,606 and $4,519. The Relative Strength Index (RSI) of 57 suggests a neutral-to-bullish sentiment, while the MACD, at 0.4400, contrasts with a signal of 49.8100, indicating mixed market signals.

A bearish engulfing candle pattern on the 4-hour chart points to a potential bearish bias. The SPX remains above the 50-Day Exponential Moving Average of $4,598.94, which traditionally suggests a short-term bullish trend. However, the current chart patterns and indicators imply a cautious approach.

The SPX outlook remains bearish below the $4,763 mark, with expectations to test lower support levels. Investors should closely monitor these key technical levels for directional cues in the short term.

Dow Prices Forecast

The Dow Jones Industrial Average (DOW) exhibited a slight uptick, gaining 0.38% to close at 37,257.80. This upward movement positions the DOW around a pivotal point at $37,168. It faces immediate resistance at $37,854, with subsequent barriers at $38,379 and $39,030. Conversely, the index finds support at $36,789, followed by lower levels at $36,509 and $36,036.

The Relative Strength Index (RSI) hovers around 49, suggesting a neutral market sentiment. The Moving Average Convergence Divergence (MACD) displays a negative value of -59.73 against a signal of 56.25, indicating potential bearish momentum. However, the DOW remains slightly above the 50-Day Exponential Moving Average (EMA) of $37,051, which could suggest a short-term bullish trend.

The current chart pattern reveals that the 50 EMA is providing crucial support around the $37,050 mark. This support level will be key in determining the DOW’s future trajectory. In summary, the overall trend for the DOW appears bullish above the $37,250 mark, and in the short term, it is expected to challenge higher resistance levels.

NASDAQ Prices Forecast