Dow Jones closes at all-time high, S&P and Nasdaq end day in red

Financials pare early losses to close in the positive territory.
Utility outperforms other major sectors.
Facebook weighs on Nasdaq Composite.

Eren Sengezer FXStreet

Major equity indexes in the U.S. started the day slightly lower as investors remained focused on the Italian budget crisis. Although the market sentiment improved later in the day with the Dow Jones Industrial Average rallying to a new intra-day record high, Wall Street painted a mixed picture at the end of the day.

Social-media giant Facebook lost nearly 2% on Tuesday and didn't allow the S&P 500 and the Nasdaq Composite stay in the positive territory. Commenting on today's market action, "This is really a story about dividends, old-line, blue-chip names outperforming what had previously been the market leaders. They have been underperforming the broader market and the FANGs for quite some time and it appears as though that rotation is now taking place," Peter Kenny, founder, Kenny’s Commentary LLC and Strategic Board Solutions LLC in New York, told Reuters.

The S&P 500 Utilities Index added 1.3% on the day to become the best performing major sector of the day. Meanwhile, the S&P 500 Financials Index, which recorded sharp losses on Monday, rebounded on Tuesday and closed the day with small gains to provide a late boost to the DJIA.

The Dow Jones Industrial Average added 123.07 points, or 0.46%, to 26,774.28, the S&P 500 lost 1.36 points, or 0.05%, to 2,923.23 and the Nasdaq Composite dropped 38.79 points, or 0.48%, to 7,998.52.

DJIA technical outlook via FXStreet Chief Analyst Valeria Bednarik

The daily chart for the Dow indicates that additional gains are still supported, as technical indicators keep recovering within positive levels and nearing their recent highs, as the 20 DMA advanced alongside with the index, now some 400 points below the current level, a sign that bulls dominate the scene.

Shorter term, and according to the 4 hours chart, the upward potential is also strong, as an intraday slide met strong buying interest around the 20 SMA while technical indicators hold well into positive territory and near their recent highs, lacking, however, directional strength at the time being.

Support levels: 26,738 - 26,679 - 26,620.

Resistance levels: 26,826 - 26,880 - 26,945.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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