Swing Trading Strategies & Stock Picks Since 2003

Dow Jones Industrial Average

Key Statistics

Open: 8447.53

High: 8580.47

Low: 8447.53

Close: 8504.06

Change: +57.06 (+0.68%)

Prev Close: 8447

RSI: 37.90

MACD: -4.24

Snapshot

• Dow ended +57.06 (+0.68%) points higher, S&P 500 up 0.44% and Nasdaq up 0.58%.
• Global manufacturing data underpins recovery hopes
• General Mills sees solid profit, stock jumps
• Wall Street waits for Thursday’s June jobs report.
• Pending home sales rose 0.1% in May
• Institute for Supply Management's manufacturing index improved to 44.8 from 42.8 in the previous month.

Current Market view– Bearish

Market Strategy

The medium term view is cautious. Traders should avoid initiating fresh longs at current levels. Prefer staying short. The market is expected to be very volatile with emphasis on the downside. The Dow Jones is currently facing resistance at 8588 levels.

June employment report could be the market mover.

Market Commentary

U.S. stocks rose on Wednesday, the start of the third quarter, as reassuring manufacturing data from China, Europe and the United States reinforced hopes that the world's economy is on the road to recovery. The current quarter started on a slightly positive note, after the previous quarter logged up high gains. 

A day after the benchmark S&P 500 wrapped up its best quarter in a decade, investors plowed new money into stocks, boosting growth-sensitive sectors like energy, industrials, technology, materials and consumer discretionaries.

 But with the release of the all-important June non-farm payrolls data just a day away, some caution prevailed, causing indexes to finish sharply off their highs.

 A weaker U.S. dollar helped stock of Coca-Cola (KO), up 2.5 percent at $49.18, as investors bet the U.S currency's decline might boost overseas earnings. Coca-Cola is one of the best-known defensive stocks, which are shares of companies deemed better able to withstand an uncertain economy.

General Mills Inc (GIS), the maker of Cheerios cereal, also gave investors more reason to be optimistic about the economy after the food company forecast a stronger-than-expected annual profit, sending its stock up 3.9 percent to $58.18.

Kraft Foods Inc (KFT), another major U.S. food company, jumped 5 percent to $26.61, following the outlook of General Mills. Kraft topped the Dow's list of major advancers.

Chip makers ranked among the Nasdaq's biggest boosters, with Intel Corp (INTC) up 3 percent at $17.04.

Ford Motor (F) said sales dropped 11% in June versus a year earlier, a more modest decline than it has shown in recent months. But Ford was the exception, with most major automakers reporting bigger-than-expected declines as the industry continued to struggle.

General Motors (GM) said sales fell 33% from a year ago. The automaker was in bankruptcy court for a second day Wednesday seeking approval for its restructuring plan.

Meanwhile, Chrysler said sales fell 42% in June versus a year ago.

On the New York Stock Exchange, only about 950.1 million shares changed hands, way below last year's estimated daily average of 1.49 billion, while on the Nasdaq, about 2.11 billion shares traded, also below last year's daily average of 2.28 billion.

Advancing stocks outnumbered declining ones by a ratio of almost 3 to 1 on the NYSE, while on the Nasdaq, about two stocks rose for every one that fell.

Economic News

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