Dow Jones, DAX 30, FTSE 100 Outlooks:
- The Dow Jones[1] enjoyed a substantial recovery last week as China reduced tariffs in an attempt to boost US imports
- The DAX 30[2] climbed despite abysmal German manufacturing figures
- The FTSE 100[3] followed other global equity markets last week as it awaits UK GDP data in the week ahead
Dow Jones Forecast
Outlook: Neutral
The Dow Jones enjoyed a considerable bounce last week after coronavirus fears worked to erode risk appetite in the week prior. Alongside ebbing concerns, China announced it would reduce tariffs on US goods in an attempt to boost US imports and conform to the specifications outlined in the phase one trade agreement.
Dow Jones, Nasdaq 100, S&P 500 Technical Forecasts[4]
Consequently, US equities climbed to new heights on Thursday before surrendering some gains on Friday despite a strong non-farm payrolls report.[5] Still, the stage has been set for the Dow Jones, Nasdaq[6] and S&P 500 to drive higher in the week ahead should risk trends allow.
Dow Jones Price Chart: 4 - Hour Time Frame (October 2019 – February 2020)
Day Trading the Dow Jones: Strategies, Tips & Trading Signals[7]
While coronavirus fears have taken a back seat for the time being, companies have continued to warn the viral outbreak will weigh on first quarter growth. Furthermore, tepid economic activity will likely offset the impact of lower tariffs which could spark trouble in the future as the US looks to hold China to its import totals. Either way, it seems as though the coronavirus could work to erode equity valuations down the line.
A potential opportunity for insight on the epidemic’s impact will occur on Tuesday when Alibaba delivers
