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  • DJIA, ended with a gain of around 100 points, or 0.4%, near 25,579.
  • The S&P 500 SPX climbed around 7 points, or 0.2%, to close near 2,848.
  • The Nasdaq Composite dropped by  7 points to close around 7,767, down 0.1%.  

Wall Street was ending the day slightly in the green following another yo-yo session on the back of forever conflicting trade war headlines and mixed outlooks for US growth. The Dow Jones Industrial Average, DJIA, ended with a gain of around 100 points, or 0.4%, near 25,579, benefitting from solid earnings in the Dow component Walmart Inc. which beat Wall Street’s expectations with a 6.1% rise – (The DJIA tumbled on Wednesday chalking up its biggest one-day percentage fall of 2019 following the inversion of the 2/10-year U.S. yield curve underlined recession fears). The S&P 500 SPX climbed around 7 points, or 0.2%, to close near 2,848. The Nasdaq Composite dropped by  7 points to close around 7,767, down 0.1%.  

US data

 On the data front, the US enjoyed stronger-than-expected retail sales figures buoyed expectations that consumers would continue to underpin the U.S. economy,  

“US retail sales were stronger than expected in July, up 0.7% m/m (last: 0.3%, mkt: 0.3%). Control group sales which feed into GDP rose a solid 1.0% m/m, and with 10 out of the 13 categories lifting, consumption appears to have started Q3 on a high note,”

analysts at ANZ Bank explained.  Elsewhere, and conversely, US industrial production came in below market, down 0.2% m/m in July with manufacturing output down 0.4% m/m:

 “Capacity utilisation eased to 77.5% (last: 77.8%). All up, it seems the drag on US growth from manufacturing has continued into the start of Q3. That said, regional manufacturing indices performed a little better than expectations.,” the analysts at ANZ argued, adding, “The Philadelphia Fed manufacturing index dipped 5pts to 16.8 (mkt: 9.5), with new orders lifting 7 points and hinting at a future pick-up in the region’s manufacturing momentum. The Empire manufacturing survey rose 0.5pts to 4.8 in August (mkt: 2.0). Overall, the early regional data point to better stability in the ISM manufacturing index this month, despite the heightened trade tensions. Manufacturing data, as clearly evidenced in the aftermath of the July FOMC meeting, has taken on increased significance for financial markets and interest rate expectations.”

DJIA  levels

The DJIA broke below the August lows having pierced below the 200-day moving average on three occasions this month. Bears will target a run to the 50% mean reversion level of the late Dec 2018 swing lows and mid-July swing market highs, with the target located down in the 24500s.