The Dow Jones Industrial Average gave up on new economic fears

• The Dow Jones fell 500 points on Monday as investor confidence falters.
• Markets fell prey to fresh recession fears after US ISM numbers missed the mark.
• Investors are scrambling for position ahead of this week’s NFP jobs report.

The Dow Jones Industrial Average (DJIA) retreated to start the new week of trading on Tuesday after US markets took the Labor Day holiday. US traders were greeted by another misprint in the US ISM manufacturing purchasing managers’ index (PMI) numbers, which failed to meet expectations for a rebound in print, sending another round of recession fears spreading in the stock markets.

The ISM manufacturing PMI for August came in below expectations, coming in at 47.2 and missing the market’s median forecast of 47.5. Despite a slight rebound from July’s multi-month low of 46.8, it failed to galvanize markets, giving already fleeing investors a perfect excuse to retreat from a recent lopsided tilt toward bullish expectations.

Tuesday’s general decline kicked off September trading with a notable bearish note as markets remain wary of softer US data on a release basis. A broad decline in the tech sector has extended a broad market pullback as the AI ​​darling race begins to show cracks, with high-profile semiconductor companies struggling to achieve high growth numbers.

Friday’s US Nonfarm Payrolls (NFP) report is important on Friday and is the last round of key US labor data before the Federal Reserve (Fed) issues its latest rate call on September 18. Friday’s NFP print is expected to set the tone for market expectations for the depth of a Fed rate cut, with investors fully pricing in the start of a new rate cut cycle this month.

Dow Jones News

Most of the Dow Jones industrial average fell into the red on Tuesday, with less than a third of the index turning green. Verizon Communications ( VZ ) still managed a 2.4% gain on the day, rising to $42.80 per share, while Intel ( INTC ) fell about 8.5% to 20 .17 USD per share.

According to market experts, Intel is at risk of being pulled from the Dow Jones index, in large part due to reports that the technology company continues to consider cutting even more departments in the company in an attempt to reassure investors.

Elsewhere, 3M ( MMM ) now tops the Dow Jones, outperforming the rest of the stock index. 3M is up nearly 50% YTD in a stellar recovery after spending half a decade in the pits.

Dow Jones Price Forecast

Tuesday’s decline in the Dow Jones Industrial Average took the index back below the 41,000 level, down more than a full percent from the day’s opening bids and poised for its worst single-day performance in a month. The Dow Jones fell 550 points after hitting new highs just last week when the DJIA bidders hit 41,600.

Despite a short-term pullback, the Dow Jones is still trading in bull country, holding well above its 200-day exponential moving average (EMA) at 38,558. The nearest technical barrier for short pressure to target is the 50-day EMA near 40,230.

Dow Jones Daily Chart