The Dow Jones Industrial Average (DJIA) kicked off the 2025 trading year with a flat performance, hovering near 42,500. Equities were mixed during the US market session, with early gains reversing by the end of the day. The first week of 2025 remains light on economic data, with the US ISM Manufacturing Purchasing Managers Index (PMI) survey results scheduled for Friday. Initial Jobless Claims for the week ended December 27 improved to 211K, below the forecasted 222K.
Roughly a third of the Dow Jones’ constituent stocks saw gains on Thursday, with Nvidia rebounding 1.8% while Boeing and Apple experienced losses of 3.5% and 3%, respectively. The Dow’s performance was mixed, with the index starting with a 300-point gain, then reversing to a -300 loss before ending near 42,250. Bearish momentum from the end of 2024 is continuing into the new year, keeping the DJIA below the 50-day Exponential Moving Average (EMA), which is trending bearishly below 43,270.
Looking at the daily chart, if bearish momentum persists, the DJIA could face a challenge of the 200-day EMA near 42,120. The intraday flows for the Dow Jones are tempering hopes for a ‘Santa Clause rally’, with the index struggling to maintain positive momentum. Despite some positive signs like the Improved Initial Jobless Claims, it may not be enough to ignite a strong risk-on bid in the market.
The Dow Jones’ performance on the first trading day of 2025 reflects a cautious sentiment among investors, with the index facing resistance below key technical levels. As the market awaits further economic data releases, such as the US ISM Manufacturing PMI, the direction of the Dow Jones will likely be influenced by both domestic and global economic trends. Traders and investors will be closely monitoring market dynamics to gauge the potential for a sustained rally or a deeper correction.
In conclusion, the Dow Jones Industrial Average’s flat performance on the first trading day of 2025 reflects a cautious market sentiment and tempered expectations for a strong rally. With mixed results among constituent stocks and technical indicators signaling bearish momentum, the DJIA may face further challenges in the near term. Economic data releases, such as the US ISM Manufacturing PMI, will be closely watched for clues about the future direction of the Dow Jones and broader equity markets. Investors should remain vigilant and adapt their strategies to navigate the evolving market conditions.
