Select Language

Dow Jones Industrial Average rises as markets hope for trade deals

Breaking news

Dow Jones Industrial Average rises as markets hope for trade deals

  • X
  • facebook
  • LINE
  • RSS

  • X
  • facebook
  • LINE
  • RSS
New update 2025.06.04 04:20
Dow Jones Industrial Average rises as markets hope for trade deals

update 2025.06.04 04:20

  • The Dow Jones Industrial Average was dragged higher by tech gains on Tuesday.
  • Lacking any meaningful news, investors are hoping that Trump's tech blockade on China will spring a leak.
  • Trade tensions are still on the rise as the US and China crash heads over preliminary trade deal terms.

The Dow Jones Industrial Average (DJIA) rose on Tuesday, bolstered by endless optimism in the tech sector. AI rally frontrunner Nvidia (NVDA) led a chip-based market advance, surpassing Microsoft's market cap for the first time since January. An unexpected but welcome upswing in JOLTS Job Openings in April helped further bolster investor feelings, who shrugged off a worse-than-expected contraction in Factory Orders during the same period.

Traders lean into bets of another Trump trade pivot

Investors continue to bank on an eventual trade deal between President Trump and China's Xi Jinping, despite still-escalating trade tensions as the two sides lob accusations of violating preliminary trade agreement terms. Trump administration staff continue to insist that Trump and Xi will be speaking directly soon, but specific details remain limited.

White House Press Secretary Karoline Leavitt confirmed on Tuesday that the Trump team had sent a hardball letter to key US trade partners, as reported earlier this week. The letter demands that countries put their "best offer" on the table in terms of trade deals by Wednesday for the Trump team to consider. President Trump's temporary delay of his own "reciprocal tariffs" package is set to expire in early July, and despite insistence that multiple major trade deals are "ready to be announced", very little in the way of tariff-averting trade agreements have been forthcoming.

Despite upbeat market sentiment, policymakers remain cautious

Federal Reserve (Fed) policymakers remain apprehensive about the future state of the US economy in a post-tariff environment, and the Fed's latest discount rate meeting minutes reveal much of the same stance from a growing number of US business operators. It's still too soon to see much in the way of immediate tariff impacts; however, the Organization for Economic Co-operation and Development (OECD) has downgraded its growth forecast for the US economy this year to 1.6% from 2.2%.

JOLTS Job Openings rose to 7.391M in April, flouting the forecast backslide to 7.1M. On the other side of the data coin, US Factory Orders contracted more than expected in April, falling 3.7% MoM, their lowest figure in 15 months. The previous month also saw a sharp downward revision, slipping to 3.4% from the initial print of 4.3%.

US ISM Services Purchasing Managers Index (PMI) survey results are due on Thursday, and investors are hoping for a slight recovery in aggregate business operator sentiment. May's ISM Services PMI print is forecast to rise to 52.0 from April's 51.6.

Dow Jones price forecast

Despite an intraday rise on tech and trade hopes, the Dow Jones remains in a congestion zone between 42,000 and 43,000. The major equity index recaptured 42,500 after testing the low side earlier this week, and investors continue to tilt toward the steady side.

The Dow Jones Industrial Average is still trading on the high side of the 200-day Exponential Moving Average (EMA) near 41,675. However, technical oscillators are leaking into overbought territory, which could open the door for a technical correction to the downside.

Dow Jones daily chart


Dow Jones FAQs

The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500.

Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.

Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow's theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits.

There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.


Date

Created

 : 2025.06.04

Update

Last updated

 : 2025.06.04

Related articles


    Show more

    FXStreet

    Financial media

    arrow
    FXStreet

    FXStreet is a forex information website, delivering market analysis and news articles 24/7.
    It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
    Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

    Was this article helpful?

    We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
    We are also looking for writers with extensive experience in forex and crypto to join us.

    please contact us at [email protected].

    Thank you for your feedback.
    Thank you for your feedback.

    Most viewed

    BoC Deputy Governor Kozicki: Many businesses expect activity to weaken in the near term

    Bank of Canada (BoC) Deputy Governor Sharon Kozicki warned on Thursday that a growing number of Canadian businesses are bracing for a general slowdown in overall activity in the coming months, which could undercut job growth performance and put downward pressure on the Canadian economy.
    New
    update2025.06.06 01:39

    Fed's Kugler: I see greater upside risks to inflation and downside risks to employment

    Federal Reserve (Fed) Board of Governor member Adrianna Kugler noted on Thursday that although growth remains firm (albeit subdued) and Fed policy appears to be holding at a moderate level, key risks are growing, specifically in regards to inflation and a growing bubble of layoff intentions from bus
    New
    update2025.06.06 01:35

    Silver prices surge to multi-year highs, posting intraday gains near 3.50%

    Silver (XAG/USD) surged sharply on Thursday, rallying nearly 4% intraday and reaching their highest level in more than a decade, as precious metals continue to attract investors amid escalating trade tensions and increased US Dollar outflows. 
    New
    update2025.06.06 00:35

    US Pres. Trump: Concluded a very good phone call with President Xi of China

    United States (US) President Donald Trump said on Truth Social on Thursday that he had a "very good phone call" with Chinese President Xi Jinping, during which they discussed the intricacies of the trade deal.
    New
    update2025.06.06 00:13

    USDCAD slips below 1.3650 as US jobless claims rise, Canada's PMI contract

    USD/CAD extended its losses on Thursday amid a busy schedule on both sides of the border, with US unemployment benefits data coming in above forecasts. At the same time, Canada's Ivey PMI shows that business activity contracted for the second straight month.
    New
    update2025.06.06 00:05

    EUR/USD climbs to six-week high as ECB cuts interest rates, US Jobless Claims disappoint

    The Euro (EUR) edges higher against the US Dollar (USD) on Thursday, following choppy price action, as traders react to the European Central Bank's (ECB) widely expected interest rate cut and disappointing US Initial Jobless Claims, which weigh on the Greenback.
    New
    update2025.06.05 23:15

    GBP/USD advances to multi-year highs above 1.3600 on renewed USD weakness

    GBP/USD gained traction in the American session on Thursday and climbed to its highest level since February 2022 above 1.3600. At the time of press, the pair was up 0.4% on the day at 1.3605.
    New
    update2025.06.05 23:02

    Lagarde speech: Facing significant uncertainty

    Christine Lagarde, President of the European Central Bank (ECB), explains the ECB's decision to lower key rates by 25 basis points at the June policy meeting and responds to questions from the press.
    New
    update2025.06.05 22:23

    Lagarde speech: We are in a good place after 25 bps rate cut today

    Christine Lagarde, President of the European Central Bank (ECB), explains the ECB's decision to lower key rates by 25 basis points at the June policy meeting and responds to questions from the press.
    New
    update2025.06.05 22:13

    Lagarde speech: Survey data point to some weaker prospects in near term

    Christine Lagarde, President of the European Central Bank (ECB), explains the ECB's decision to lower key rates by 25 basis points at the June policy meeting and responds to questions from the press.
    New
    update2025.06.05 21:58

    Disclaimer:arw

    All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

    The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

    • Facebook
    • Twitter
    • LINE

    Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

    I agree
    share
    Share
    Cancel