Dow Jones, Nasdaq 100, DAX 30, Nikkei 225 Outlooks:
- The Dow Jones[1] and Nasdaq[2] pulled back last week after previously ignoring weakening fundamentals
- The DAX 30[3] will look to stave off a deeper decline with a chunk of German economic data due
- Meanwhile, the Nikkei 225[4] will look to maintain its valuation after a significant GDP contraction
Dow Jones & Nasdaq 100 Forecast
Outlook: Neutral
At the beginning of last week it looked as though the Dow Jones and Nasdaq were impervious to the slew of fundamental concerns that had worked to spark significant developments[5] in the foreign exchange, commodity and bond markets. As the week progressed, however, risk aversion finally materialized and the US equity market came under pressure – a long awaited development for some.[6]Looking ahead, price action in gold[7] and the Australian Dollar[8] could suggest the Dow Jones and Nasdaq are susceptible to further declines.
Dow Jones Price Chart: Daily Time Frame (December 2018 – February 2020)
Day Trading the Dow Jones: Strategies, Tips & Trading Signals[9]
To be sure, the global economy is under threat. Prior to the outbreak of the coronavirus, major economies like Germany and Japan had already begun to show signs of weakness and global shipping was on the decline. Now that the world’s second largest economy – one that possesses significant manufacturing responsibility – has had to quarantine multiple cities and shutter businesses for weeks, the pressure may be excruciating.
While central banks have looked to ward off prior slowdowns with monetary policy, many of the traditional avenues have already been explored which has left central banks with less ammunition to fight a deeper contraction
