Dow Jones sets new record high before retreating on Friday

• The Dow Jones hit a new record high to round out the trading week.
• US PCE inflation held steady in July, teasing investors without offering hope.
• Coming up next week: US long weekend, PMI numbers and another NFP print.

The Dow Jones Industrial Average (DJIA) hit a new intraday high on Friday, echoing Monday’s record-setting auction action. However, investors pulled back from the threshold after US inflation data kept bets on low rates on the rails.

US Personal Consumption Expenditure (PCE) price index figures for July offered no notable surprises to round out the trading week. US monthly core PCE inflation was steady at 0.2%, as expected, but the annual core PCE inflation figure was steady at 2.5% versus the anticipated move of up to 2.6%.

Rate markets are holding firm to a 30% chance of an initial double 50-basis-point cut from the Federal Reserve (Fed) on September 18, with the remaining 70% leaning towards a single quarter-point cut. Rates traders are generally pricing in 100 bps in total cuts in 2024, according to CME’s FedWatch tool.

With PCE inflation data out of the way and showing no warning signs, the way is open to next week’s Non-Farm Payrolls (NFP) print, one of the last key economic data points standing in the way of the Fed and reducing rates. hungry markets. Next week will also open on a quiet note, with US exchanges set to remain closed for the Labor Day holiday. Some versions of the Purchasing Managers’ Index (PMI) are also scattered throughout the trading week.

Dow Jones News

It was a mixed bag for the Dow Jones on Friday. About half of the index’s constituent stocks are in the green for the day, and the DJIA hit a fresh all-day high of 41,497 before returning to the day’s opening bids. On the downside, Salesforce ( CRM ) returned 1.8% to $252.35 a share, while American Express ( AXP ) contracted just over 1% to $252.25.

On the upside, Intel ( INTC ) rose more than 9% at its peak, hitting its biggest offering in nearly a month after rumors emerged that the company was looking to spin some of its core operations into more profitable sectors.

Dow Jones Price Forecast

Bullish momentum continues to defy its peg, keeping the Dow Jones testing new highs and keeping price action anchored deep in bull country. The index is trading well north of the 200-day exponential moving average (EMA) at 38,513, and the closest technical level to catch a downside correction is parked at the 50-day EMA, just above the major price level of 40,000.

The Dow rose more than 8 percent from an August low to 38,382, hitting new records twice in a single week. Despite closing in the green for three consecutive weeks, momentum from the top is beginning to fade and bidders may want to watch for a transition period that gives way to a rapid decline that could gain speed as it triggers long-term stops short.

Dow Jones Daily Chart