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Inflation Fears Major Indices Retreat: NASDAQ, S&P 500, and Dow Jones Forecasts

Inflation fears major indices

In recent market developments, Inflation fears major indices including NASDAQ, S&P 500, and Dow Jones. All three indices have faced a significant retreat due to escalating inflation concerns.

ISM Report on Inflation Fears Major Indices

The ISM Services PMI report revealed a rise from 52.7 in July to 54.5 in August, surpassing analysts’ predictions. This unexpected increase, coupled with rising oil prices, has contributed to the mounting pressure on these indices.

The bond market witnessed a surge in Treasury yields, as traders increasingly bet on a more hawkish Federal Reserve. Meanwhile, concerns surrounding escalating oil costs have sparked worries about potential inflation, potentially prompting the Fed to consider interest rate hikes. Given the Fed’s pivotal role in the market, traders remain highly sensitive to fluctuations in Treasury yields.

S&P 500 Value

The S&P 500 recently attempted to breach the 4450 level, but it lacked the necessary downward momentum. A decisive breach below the 4430-4450 support range would set its sights on the next support level at 4335-4350.

Over in the NASDAQ, the Inflation fears major indices faced a setback as Apple’s stock plummeted by nearly 4%. This decline was intensified by reports of a ban on iPhones for government staff in China, adding pressure to the tech giant. Additionally, NVIDIA’s 3.2% decline further contributed to the NASDAQ’s pullback.

NASDAQ Stabilization

Should the NASDAQ manage to stabilize below the support zone at 15,200-15,300, the next support level to watch for lies in the 14,560-14,680 range.

In tandem, the Dow Jones index also moved lower, largely attributed to the substantial sell-off in Apple shares. Notably, this market-wide pullback saw a majority of Dow Jones components in the red.

If Dow Jones remains below the critical 34,500 level, it is likely to target the subsequent support zone at 33,600-33,700.

These developments highlight the critical role played by inflation concerns, ISM data, and the performance of key stocks in shaping the current market landscape.

Trading Compass

Disclaimer: Please note that this article serves solely for informational purposes and should not be construed as financial advice. We strongly advise readers to conduct thorough research and consult with financial professionals before making any investment decisions


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