- Energy shares drop amid falling crude oil prices.
- Technology extends gains, boosts Nasdaq.
- Market action suggests a cautious approach by investors.
Following a flat opening, major equity indexes in the United States fluctuated in relatively tight ranges on Wednesday as investors continue to assess the potential impact of the tax bill on different parts of the economy.
“It’s hard to speculate on what the final bill is going to say. I think the market moves a little bit on that, but mostly moves on fundamentals and sentiment, which are strong. To the end of the year, investors tend to reposition, making sure their portfolio finishes the year where they wanted and begins the next year where they hope to be,” Sean O‘Hara, director at Pacer Financial Inc., told Reuters.
Although today's EIA data showed a larger-than-expected drawdown in the crude oil inventories in the United States, crude oil prices came under a heavy selling pressure as the underlying details of the report pointed to a rising oil output in the United States. The barrel of West Texas Intermediate recently broke below the $56, losing 3% on the day. The S&P 500 Energy Sector (SPNY) closed the day 1.3% lower.
On the other hand, boosted by robust gains seen in the shares of Microsoft, Alphabet, and Google, the S&P 500 Information Technology Sector rose 0.75% on the day, allowing the tech-heavy Nasdaq Composite to end the day at 6,776.38, up 0.21%.
At the end of the day, the Dow Jones Industrial Average was down 35.53 points, or 0.15%, at 24,145.11, and the S&P 500 was virtually unchanged at 2,629.62.
DJIA technical outlook
Valeria Bednarik, American Chief Analyst at FXStreet, wrote, "the movement remains as corrective, as the index develops far above bullish moving averages, with the closest one being the 20 SMA, now at 23,740. Shorter term, and according to the 4 hours chart, the bearish stance is strong, as the index remained below its 20 SMA, now slowly gaining traction downward, while technical indicators resumed their declines after a modest correction upward within the negative territory."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.