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Wall Street mixed ahead of Powell at the Jackson Hole

  • DJIA, +0.19% added 51 points, or 0.2%, to finish around 26,254.
  • The S&P 500 lost less than 0.1% to end near 2,923.
  • Nasdaq Composite fell 0.4% to close near 7,991.

On Wall Street, the standout stock was Boeing which rally helped to support the DJIA into a positive close. The Dow Jones Industrial Average DJIA, +0.19% added 51 points, or 0.2%, to finish around 26,254 while the Nasdaq Composite fell 0.4% to close near 7,991. The S&P 500 lost less than 0.1% to end near 2,923. 

The moves come ahead of a bog deal in markets with Jackson Hole getting underway and the G7. Markets will be watching Chair Powell's remarks at the Jackson Hole Symposium at 10am EDT on Friday for direction at this point.

Jackson Hole

"Given current pricing for a further 60bp of rate cuts in 2019 and 40bp more cuts in 2020, we believe markets will come away disappointed as Powell is unlikely to pre-commit to rate cuts. This could weigh on equities and bull flatten the Treasury curve," analysts at TD Securities explained:

"We do not anticipate significant announcements by Powell regarding the policy outlook. If anything, we would expect him to reiterate his post-FOMC press conference message, where he argued that the Fed was embarking on a "mid-cycle adjustment" in policy. We also expect policymakers to stay non-committal in their guidance for future rate cuts and state that they will remain watchful of upcoming data and developments on global growth and trade uncertainty."

US data

The Markit Purchases Manufacturing Index (PMI) fell to 49.9 to enter the contractionary zone for the first time in a decade. "New orders and export sales fell to their lowest level since August 2009. The wider composite index which takes into account both manufacturing and services fell to 50.9. Meanwhile, the US Leading Economic Index lifted 0.5% in July to indicate moderate growth in H2 2019," analysts at ANZ Bank noted.

DJIA levels

Meanwhile, from a technical perspective, the DJIA is holding onto the 26000s heading still. A push to the upside will open that case for the 50-DMA with the 26700s as a key upside target for the bulls. Bears, on the other hand, can target the 50% mean reversion level of the late Dec 2018 swing lows and mid-July swing market highs down in the 24500s. 

Author

Ross J Burland

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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