Dow Retreats From Record High as Tech Drags Nasdaq Lower
U.S. equities lost ground once again, while currency markets saw a strong and broad rally in the U.S. dollar, particularly against the yen.
Quick overview
- U.S. equities declined across all major benchmarks, with the Russell 2000 showing the weakest performance amid risk aversion.
- The U.S. dollar experienced a significant rally against major currencies, particularly the yen, despite the absence of a clear catalyst.
- Federal Reserve Chair Powell's dovish remarks contributed to market sentiment, but inflation concerns lingered.
- Key technical levels, such as the 20-day simple moving average for the Dow, may provide support for equities moving forward.
U.S. equities lost ground once again, while currency markets saw a strong and broad rally in the U.S. dollar, particularly against the yen.
Dollar Strength Leads Market Moves
The most striking action in today’s session was in foreign exchange rather than equities. The U.S. dollar climbed sharply, advancing by around 125 pips against the yen in a broad move across major currencies. What made the surge notable was the absence of a clear catalyst. Powell’s remarks yesterday were generally dovish, though his acknowledgment of lingering inflation pressures gave markets something to latch onto. Still, the reaction seemed outsized compared to the modest repricing in Fed funds futures, which erased only about 2.5 basis points of expected easing over the next year.
Equities Retreat After Recent Highs
On Wall Street, all four major benchmarks ended the day lower. The Russell 2000 was the weakest performer, reflecting continued risk aversion toward smaller and more volatile stocks. The Dow Jones in particular gave back recent gains, forming a bearish daily candlestick just a day after posting an upside-down pin bar at a fresh record high. The S&P 500 and Nasdaq also slipped, mirroring a cautious sentiment across the board.
Technical Picture Still Offers Support
Despite the day’s pullback, equities remain supported by key technical levels. For the Dow, the 20-day simple moving average, which has recently acted as a reliable base, is not far below current levels. Investors will be watching closely to see if these averages once again provide support, or whether the latest bout of selling signals a deeper correction.
Dow Jones Chart Daily – MAs Keeping the Trend Bullish
Closing Levels for Major U.S. Indices
- Nasdaq Composite: finished at 22,497.86, down −75.62 points (−0.33%) after a day of uneven tech trading.
- Dow Jones Industrial Average: ended at 46,121.28, losing −171.50 points (−0.37%) as cyclical sectors weighed.
- S&P 500: settled at 6,637.97, a decline of −18.95 points (−0.28%), reflecting broad-based but moderate pressure across large caps.
- Russell 2000: closed at 2,434.98, down −22.53 points (−0.92%), underperforming as small-cap stocks faced heavier selling.
Dow Jones Live Chart
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