September 28, 2020

Stock Market: Dow Set To Open Higher

Stock Market: Dow Set To Open Higher

Global Stock Market Today

The global stock futures have started the week on the front foot, and traders are trying to erase losses that we saw in the equity markets over the course of the last three weeks. On Friday, we saw the U.S. stock indices recording four consecutive weeks of losses. This was the first time since August 2019 that we have seen such a long losing streak for the U.S. stock indices.

Investors are concerned about the rising coronavirus cases around the globe. New York saw over 1,000 new coronavirus cases on Saturday, and this was the first time that the state had seen such a number since June. 

In Asia, most of the stock indices closed higher, with the HSI index advancing 0.92%. The Shanghai stock index also moved higher by 0.10%, while the Korean Kospi advanced 1.36%. The Nikkei index surged 1.05%. 

Dow Index and S&P500 Index: Market Breadth

The Dow Jones market breadth strengthened on Friday. 61% of the Dow Jones stocks traded above their 200-day moving average yesterday. This is a change of +1% from the day before.

The S&P 500 stock breadth also improved on Friday.  53% of the shares traded above their 200-day moving average on Friday. 

Dow Jones and S&P 500 Futures Today

The Dow Jones futures are trading higher by 120 points. Investors will be listening to the central bankers today. Christine Laggard, the president of the European Central Bank is scheduled to speak later in the afternoon. While she speaks, the focus will be on the Euro-dollar pair, which has been trading lower for the past couple of weeks. We will also hear the view of Fed committee member Mester. Investors eagerly anticipate her view of the economy.

The Dow Jones futures have sharply bounced back from the 100-day simple moving average on the daily time frame. The Dow fell below this average last week and traded below the average for two days. The fact that the price has moved above the 100-day SMA is a positive sign for the bulls. However, the Dow futures are still trading below the 50-day SMA. 

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The S&P 500 futures, the wider representation of the U.S. equity market, are also very much following the footsteps of the Dow. The S&P 500 has also moved above the 100-day SMA on the daily frame, and the next challenge is the 50-day SMA.

Stock Market Rally 

The S&P 500 stock index gained some strength on Friday and closed higher by a small margin of 1.30%. The technology sector led the index higher, and all 11 sectors closed higher. 

Norwegian Cruise line stock contributed the biggest gain, soaring 7.7%. Apache Corp. stock was the largest drag; it fell by 10.3%. The S&P 500 stock index is up 5.2% during this quarter.

The Dow index also moved higher on Friday, and the Dow stocks moved the index higher by 1.34%. Two stocks of the Dow Jones Index increased in value, and Eight shares of the Dow index moved lower. Boeing stock advanced higher by 6.83%, and was the biggest mover for the Dow, while Dow chemicals stock dropped 0.97%, the biggest drag for the Dow Jones Industrial Average index.  

The NASDAQ composite, a tech-savvy index, gained 2.26% on Friday.