DJ 30 RISES ABOVE MA5 ON TRADE OPTIMISM; HOME SALES OUTPERFORM
DJ 30 futures are currently trading at 25864- higher by 0.45% as compared to the previous close. The contract closed in the positive territory in the last trading session also.
In the Cash Markets, the DJIA rose 150 points as stocks of Caterpillar and Boeing outperformed. U.S. equities rose today amid renewed optimism on the progress of trade talks between the U.S. and China as Wall Street concluded a stellar quarterly performance.
U.S. officials said China had made unprecedented proposals on a range of issues— including on forced technology transfer. Treasury Secretary Steven Mnuchin also said earlier today that he had a “productive working dinner” with Chinese trade officials on Thursday, as both sides resume negotiations with the hope of bringing an end to their trade dispute.
Bank shares also rose broadly on Friday. Goldman Sachs was up 0.37% at the time of writing.
Trade-sensitive industrials advanced 0.74%, while chipmakers, which have a large revenue exposure to China, also rose today.
Other top gainers in the Dow Jones include Boeing (up 1.65%), Caterpillar (up 2.19%), and UnitedHealth Group (up 0.98%) at the time of writing.
On the other hand, index-member DowDuPont dropped 2.47% after brokerages lowered their price targets on the chemical company, citing bad weather and margin pressures.
The benchmark index is on track for a 1.2% weekly gain, while logging around 0.4% drop for March. The 30-stock index is up 10.3% this quarter through Thursday’s close — its best start to a year since 2013.
Official data released earlier today showed that sales of new U.S. single-family homes rose to an 11-month high in February. New Home Sales for February released on Friday came in at 667K. Sales figures were above the market expectation of 620K. Also, sales for January were revised higher, suggesting that lower mortgage rates were starting to lift the struggling housing market.
In addition, Chicago PMI for March also out today came in at 58.7. The PMI reading was below the consensus estimates of 61.0.
On the technical front, the RSI is currently at 55.01% and suggests that the market can move in the upward direction. The current price is above the MA5. The current price is above the middle line of the Bollinger Bands and is heading upwards.
Overall Bias is Positive and Short-term trades can be initiated with tight Stop Loss and Take Profit targets.
Trade Suggestion-Limit Buy At 25845, Take Profit At 25935 Stop Loss At 25800