Mon. May 20th, 2024

DOW JONES TICKS UP WITH GEOPOLITICAL RISKS WEIGHING ON RISK APPETITE

The Dow Jones Industrial Average (DJIA) is going through a moderate advance in a cautious session on Tuesday morning.

  • Dow Jones index advanced moderately with geopolitical tensions limiting gains. 
  • Good quarterly earnings from United Health and Morgan Stanley provide optimism.
  • Technical picture remains bearish with DJIA drifting away from March highs. 

The Dow Jones Industrial Average (DJIA) is going through a moderate advance in a cautious session on Tuesday morning. The high US Treasury yields and market concerns about the volatile situation in the Middle East have offset the positive impact of quarterly earnings results.

United Health and Morgan Stanley have reported better-than-expected quarterly earnings on Tuesday, offsetting the disappointing results by Bank of America (BAC) and Johnson & Johnson (JNJ).

Traders, however, remain wary of risk as Israel ponders its response to Iran’s missile attack as the international community pressures its leaders to show restraint.

In this scenario, the main Wall Street indices are mixed, with the Dow Jones 0.4% higher to 37,897, while the S&P 500 and the NASDAQ are practically flat at 5,062 and 15,890, respectively.

Dow Jones news

The Health gains for the second consecutive day with a 0.4% advance. That sector’s gains are followed by Technology, 0.3% higher. The Energy sector is the worst performer with a 1.08% decline, and next is the Utilities sector, down 0.95%.


UnitedHealth (UNH) is outperforming with a 6.2% rally to $473.43 after its quarterly report beat expectations. Salesforce (CRM) rises 2% to $278.45. On the negative side, Johnson & Johnson drops 2% to $144.67, and Apple (AAPL) loses another 1.7% to $169.78.

Dow Jones technical outlook

The DJIA index is trimming some loose ends on Tuesday although the overall picture remains bearish. The move below 38,560 has activated a Head & Shoulders pattern that points toward a sharper decline.

Immediate support is 37,586, followed by the measured target of the H&S pattern, which meets the mid-January low and 38.6% Fibonacci retracement at 37,087. A bullish reaction might find resistance at the 38,531 previous support ahead of the 39,000 region (order block).

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