Dow Jones and S&P 500 close higher, Nasdaq slips on tech sell-off

  • U.S. officials are reportedly reaching out to China for trade negotiations.
  • Apple suffers losses after the introduction of the new iPhone.
  • EIA's weekly report provides an additional boost to crude oil.

Although major equity indexes in the United States started the day higher and gathered momentum during the first half of the day, they failed to stretch higher in the late NA session and finished the day mixed.

A report published in The Wall Street Journal on Wednesday claimed that the U.S. officials were reaching out to their Chinese counterparts to have a new round of trade negotiations before they implement the additional $200 billion worth of tariffs on Chinese imports. The trade-sensitive S&P 500 Industrials Index gained traction on this report and closed 0.37% higher. On the other hand, after the weekly EIA report revealed a larger-than-expected fall in the U.S. crude oil stocks, the barrel of WTI extended its recovery above $71 before settling 1.6% higher at $70.37 and the S&P 500 Energy Index added 0.5%.

Meanwhile, following the strong rebound witnessed on Wednesday, Apple shares reversed course after the company introduced its new iPhone. “You had the (Apple) announcement, and the typical trader reaction was there wasn’t anything that wasn’t already rumored or expected from the announcement, so some of yesterday’s gains are being given back today,” Michael James, managing director of equity trading at Wedbush Securities in Los Angeles, told Reuters.

The S&P 500 Information Technology Index closed 0.5% lower and caused the Nasdaq Composite Index, which lost 18.39 points, or 0.23%, to underperform.

At the end of the day, the Dow Jones Industrial Average added 27.86 points, or 0.11%, to close at 25,998.92 while the S&P 500 was up 1.02 points, or 0.04%, at 2,888.91.

DJIA technical outlook via FXStreet Chief Analyst Valeria Bednarik

The daily chart for the Dow offers a neutral technical stance, as the index posted a higher high and a higher low daily basis, while an intraday decline met buyers on a test of a bullish 20 DMA. Indicators in the mentioned chart, however, continue losing strength, the Momentum entering negative territory and the RSI currently at 59.

Shorter term, and according to the 4 hours chart, the index is holding above its 20 and 100 SMA, both converging around 25,940, while technical indicators turned marginally higher around their midlines, also presenting a neutral stance, although leaning the scale toward the upside. 

Support levels: 25,940 25,883 25,826.

Resistance levels: 26,043 26,091 26,146.

 

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