Market Reactions: Dow and S&P 500 Dip, Nikkei 225 Stabilizes
Dow Experiences Setback After CPI Report
The recent US inflation update led to a sharp downturn on Wall Street, pushing the Dow to its lowest point since February 14th. Despite being close to its recent record high, the index has struggled to maintain its upward trajectory.
Over the last week, it closed below the 50-day simple moving average (SMA) for the first time since early November.
Further drops might push the Dow towards the rising 100-day SMA, and possibly back to its February 13th low of 38,037. A rebound above 39,000 could suggest that a temporary low has been established.
DOW JONES DAILY CHART – APRIL 11TH, 2024.img
S&P 500 Manages to Stay Above 50-day MA
The S&P 500 has seen less abrupt declines, yet the downturn has been more prolonged. During Wednesday’s trading, the index reached a three-week low, although the long-term uptrend from October is still holding.
Contrary to the Dow, the S&P 500 remains above the 50-day SMA.
A fall below this moving average could indicate further short-term losses, while a climb back over 5250 might signal that the index has found a low point.
Nikkei 225 Recovers Despite US Inflation Impact
Despite being affected by the latest US CPI data, the Nikkei 225 has been somewhat shielded from severe losses by ongoing yen weakness.
The index has sustained above last week’s low of 38,771, though it briefly dipped below the 50-day SMA again. Stabilizing above 39,000 and closing beyond 40,000 could indicate that the index has bottomed out for now.
More immediate concerns include the early March low at 38,300, which could be tested if the weakness persists.
