• Financials slip ahead of Fed's expected rate hike.
  • Crude oil prices continue to support energy.
  • Consumer confidence in the U.S. continues to rise.

Despite the upbeat macroeconomic data releases from the United States on Tuesday, major equity indexes in the United States finished the day mixed as investors are getting ready for tomorrow's FOMC meeting, at which the Fed is widely anticipated to announce a 25 bps increase to the key policy rate. The rate-sensitive S&P 500 Financials Index closed the day 0.38% to reflect the rate hike expectations. 

Earlier in the day, the data released by the Consumer Board showed that the consumer confidence in the U.S. rose to its highest level in nearly 18 years in September. The publication highlighted that consumers’ assessment of current conditions remained extremely favourable on the back of a strong economy and robust job growth. Commenting on the report, “the consumer is always in the driver’s seat when it comes to stoking the fires that run the engines of economic growth, but the million dollar question is what is going to happen down the road when the trade tariffs start to bite?” Chris Rupkey, the chief economist at MUFG in New York, told Reuters.

Nonetheless, 8 of the 11 major sectors finished the day with losses. The S&P 500 Consumer Discretionary Index added 0.6% to become the best performing sector of the day and modest gains seen in crude oil prices helped the S&P 500 Energy Index close 0.57% higher.

At the end of the day, the Dow Jones Industrial Average erased 67.31 points, or 0.25%, to 26,494.74 points, the S&P 500 dropped 0.13%, or 3.74 points, to 2,915.63 while the Nasdaq Composite gained 14.30 points, or 0.18%, to 8,007.55.

DJIA technical outlook via FXStreet Chief Analyst Valeria Bednarik

The Dow fell for a second consecutive day, holding however within last Thursday's range. In the daily chart, technical indicators are extending their declines from overbought readings and holding within positive levels, while the 20 DMA maintains its bullish slope far below the current level, somehow suggesting that ongoing slide could be just a correction ahead of fresh highs.

Shorter term, however, and according to the 4 hours chart, the risk remains skewed to the downside as the index failed to recover above a now flat 20 SMA, while technical indicators maintain their bearish slopes, reaching fresh weekly lows within the negative territory.

Support levels: 26,446 - 26,406 - 26,353.

Resistance levels: 26,563 - 26,610 - 26,671.

 

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