Indices mostly oscillatory as US yield curve inversion deepens
Dow and Nasdaq mostly in consolidation while DAX finishes higher despite contracting GDP and worsening outlook.
DOW: No news isn’t necessarily good news as tariff deadline approaches
It’s a tricky situation for this index, with US data yesterday better than expected with CB’s figure dropping only slightly on last month, Richmond’s manufacturing index avoiding contraction, and housing still experiencing price gains even if one of its estimates was below expectations. However, no news isn’t necessarily good news at this stage given the trade war and fresh tariffs set to be applied, with financials and Apple lagging yesterday. In terms of sentiment, retail bias is on the verge of shifting back to majority long following a 10% reduction to a slight majority short 53% as range-trading takes hold amongst retail traders for this index. That stands in contrast to institutional traders holding an extreme long 88% and hurt by the failure of this index’s price to rise.
NASDAQ: Finishing close to where it started as indices fail to hold onto gains amidst ongoing trade war
Both Dow and Nasdaq experienced mostly oscillatory movement, though in the Nasdaq’s case it’s interesting that retail bias hasn’t budged at all, remaining at a majority short 61% even as consolidatory movement takes hold in the absence of any significant trade war news. Most of the technical indicators are neutral, but a positive DMI and a trending ADX usually mean positive bias from a technical standpoint. However, its price is below most of its main moving averages and has failed to reach recent highs. And then there’s the fundamental outlook that remains bleak (to say the least).
DAX: Finishing higher as its bear trend technical overview continues to stall
Its official, Germany’s GDP figures confirmed contraction for Q2, and invoked recessionary fears for the Eurozone’s powerhouse that could spread to other manufacturing hubs as the trade war fails to subside. It also didn’t help that Norway’s $1 trillion sovereign wealth fund’s manager recommended shifting funds out of European equities and into US equities. Yet, despite all the bad news, the DAX managed to outperform compared to US equities, as its bear trend technical overview continues to stall heavily as investors now await the ECB’s decision in September to see if they’ll bring in a fresh round of easing. Meanwhile, the German 10-year yield continues to drop further into negative territory, ahead of a bond auction later today preceded by other German data.
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
Seize your opportunity
Deal on the world’s stock indices today.
- Trade on rising or falling markets
- Get one-point spreads on the FTSE 100
- Unrivalled 24-hour pricing
See opportunity on an index?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on an index?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from one point on the FTSE 100
- Trade more 24-hour indices than any other provider
- Analyse and deal seamlessly on smart, fast charts
See opportunity on an index?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
