Dow Jones Industrial Average claws back ground on Friday after steep losses

• Dow Jones finds a thin rebound after getting clobbered this week.
• Investors looking for a foothold after a harsh rebalance of rate cut expectations.
• US Durable Goods Orders, UoM Consumer Sentiment recovered on Friday.

The Dow Jones Industrial Average (DJIA) is moderating on Friday, finding thin gains after seeing its second-worst trading day of 2024 on Thursday. The equity index is up around a fifth of a percent heading into the trading week’s close, with investor sentiment broadly recovering.

Read more: US Durable Goods Orders rise 0.7% in April vs. -0.8% expected

US Durable Goods Orders in April rose 0.7% MoM, shrugging off the forecast -0.8% decline, while the previous month’s print was revised to 0.8% from 2.6%. The University of Michigan’s Consumer Sentiment Index for May climbed to 69.1 versus the forecast uptick to 67.5 from the previous 67.4. UoM 5-year Consumer Inflation Expectations also eased to 3.0% from the expected hold at 3.1%, putting further upside pressure on market sentiment as investors look for any sign that inflation figures could ease moving forward.

Forecasting the Coming Week: Fedspeak and PCE remain in the spotlight

Broad-market expectations of Federal Reserve (Fed) rate cuts were knocked back once again this week, and according to the CME’s FedWatch Tool, rate traders are pricing in slightly worse than even odds of at least a quarter-point rate cut from the Fed in September. This is sharply lower than the 70% odds of at least 25 basis points that was priced in at the beginning of the week.

Dow Jones news

A meager Friday recovery leaves the DJIA the worst-performing of the major US equity indexes, with the Dow Jones rising a scant 60 points after Thursday’s steep 600+ point decline. Less than a third of the Dow Jones’ constituent securities are down on Friday, with losses being led by Salesforce Inc. (CRM). CRM is down -2.6% on the day, falling to $271.38 per share. On the high side, Intel Corp. is the Dow Jones’ top gainer, climbing around 2% to $30.68 per share.

Dow Jones technical outlook

The Dow Jones finds thin gains on Friday as the major equity index struggles to recover from recent bearish momentum. The Dow Jones is grappling with the 39,000.00 handle after tumbling from record all-time highs set last week above 40,000.00. An intraday technical floor is priced in at 39,020.00, but the index is steeply off highs, down -2.55% top-to-bottom from last Friday’s record peak.

Downside momentum is running into technical support from the 50-day Exponential Moving Average (EMA) at 38,908.78. Despite near-term losses, the Dow Jones remains firmly bullish, trading deep into bull country and up 3.7% in 2024.

Dow Jones five minute chart

Dow Jones daily chart