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The Dow Jones Industrial Average (DJIA) found slim gains on Wednesday, gaining around 100 points from Tuesday’s close. The Dow is testing the 44,250 region as the major equity index rebounds from a near-term low after five straight sessions of declines last week.

The Dow Jones has clawed back nearly half of the declines priced in last week, rebounding around 2% after hitting a near-term low of 43,330. The Dow caught a technical bounce from the 50-day Exponential Moving Average (EMA), now rising into 43,550 as bullish momentum drags price action back into the high end.

Equities claw back losses as rate cut hopes rise

A sharp downgrade to US employment data last week sparked a rebalancing of rate cut expectations from the Federal Reserve (Fed) at its upcoming interest rate decision next month. Markets have piled back into bets that the Fed will deliver at least a quarter-point rate cut on September 17 in an effort to shore up the United States (US) economy, but the potential for a steepening slowdown in job creation, as well as still-stubborn inflation data, is capping continued record-setting index growth.

Earnings season is still in full swing, with over 80% of all reporting companies listed on the Standard & Poor’s 500 (SP500) index posting better-than-expected Q2 results. Mcdonald’s (MCD) rose 2%, climbing into fresh two-month highs above $308.50 per share after beating the street on earnings through the second quarter, while Advanced Micro Devices (AMD) shed over 6% to test below $163.00 per share after flubbing earnings per share forecasts.

Dow Jones 5-minute chart

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Dow Jones daily chart

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