DOW JONES CROSSES 27,000 FOR THE FIRST TIME EVER; CPI OUTPERFORMS
DJ 30 futures are currently trading at 27014- higher by 0.59% 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 jumped to a record high on Thursday. The 30-stocks index rose led by UnitedHealth stocks, after testimony from Fed Chief Jerome Powell supported the case for easier monetary policy in the U.S.
On Wednesday, in testimony to the House Financial Services Committee, Chairman Powell said business investments across the U.S. have slowed as uncertainties over the economic outlook linger. The chairman further said that FOMC participants saw that the case for a more accommodative policy had strengthened.
Stocks of UnitedHealth rose 5.65% after President Trump administration abandoned a proposal to eliminate drug rebates.
However, drugmakers such as Pfizer and Merck & Co fell 3.4% and 5.3% respectively at the time of writing. The Nasdaq biotech index dropped 1.47%.
According to market sources, the lack of progress in Washington suggests that the healthcare industry will face ongoing political pressure.
Microsoft added 0.17% after investment bank Cowen initiated coverage of the tech giant’s stock with an outperform rating and $150 price target.
Bank shares were trading higher on Thursday. Goldman Sachs and JP Morgan Chase gained 2.58% and 0.99% respectively at the time of writing.
Other top gainers in the Dow Jones include 3M (up 1.39%), Boeing (up 1.44%), and Nike (up 0.76%) at the time of writing.
Official data released earlier today showed that U.S. underlying consumer prices rose by the most in about 1-1/2 years in June. The Core CPI (MoM) for June released earlier today came in at 0.3%. The CPI growth was above the consensus estimates of 0.2%.
In addition, Initial Jobless Claims released earlier today fell to 209K in the week ended 6th July from 221K in the week prior. Claims figure was below the market expectation of 220K.
On the technical front, the RSI is currently at 65.25% 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 26995, Take Profit At 27085 Stop Loss At 26950