DJ 30 CRASHED BY 2%- US-CHINA TENSIONS, EMPLOYMENT NUMBERS IN FOCUS
DJ 30 futures are currently trading at 24564- lower by 2.24% as compared to the previous close. The contract has been closing in negative territory since the last three trading sessions.
In the cash markets, the DJIA was down 505 points at the time of writing. The benchmark has dropped more than 1300 points between Tuesday and Thursday. On Tuesday the index fell around 800 points.
US Stocks fell sharply today as continuing fears over U.S.-China trade relations and concern over a possible global economic slowdown kept investors on edge. Trade fears ratcheted up after news broke on the previous day that Huawei CFO was arrested by Canadian authorities in Vancouver, where she faces extradition to the U.S.
Shares of major banks were traded lower on Thursday. Index-member J.P. Morgan Chase was down 3% at the time of writing.
Index-constituent, Apple was down 2.5% in early trading on Thursday. Rosenblatt cut its price target on Apple stocks to $165 from $200, forecasting that the company will produce and ship roughly 39 million iPhone units in the January-March quarter. Also, UBS said in a note that it sees the weakest “purchase intent” for the iPhone in five years. The bank cut its 12-month price target on Apple to $210 from $225.
Other top losers in the Dow Jones include UnitedHealth (down 2.6%), Boeing (down 4.6%), Caterpillar (down 1.9%), and Chevron (down 2.4%) at the time of writing.
On the economic front, ADP Nonfarm Employment Change for November released earlier today came in at 179K. The employment change was below the consensus estimates of 196K with the reading for October revised to 225K from 227K reported earlier. In addition, Trade Balance for October also released today came in at -55.50B. Trade balance numbers were below market expectations of a decline of 55.20B.
On the technical front, the RSI is currently at 41.45% and suggests that the market can move in the downward direction. The current price is below the MA5 (25221).The current price is below the middle line of the Bollinger Bands, and is heading downwards.
Overall Bias is Negative and Short-term trades can be initiated with tight Stop Loss and Take Profit targets.
Trade Suggestion-Limit Buy At 24600, Take Profit At 24450 Stop Loss At 24680