Dow Jones Stagnates as Earnings Tsunami Looms—Rate Cut Hopes Evaporate
Wall Street holds its breath while corporate America prepares to open its books. The Dow Jones Industrial Average (DJIA) flatlines—traders aren’t betting on Santa Claus coming early this year.
Rate Cut Dreams Fade Fast
The Fed’s so-called 'dovish pivot'? More like a myth at this point. Markets priced in six cuts for 2025 back in January—now they’d be lucky to get two. Funny how reality bites when inflation won’t die.
Earnings Season: Brace for Impact
Big Tech reports this week. Will AI hype justify nosebleed valuations? Or will 'efficiency measures' (read: layoffs) dominate the headlines? Place your bets—the house always wins.
Closing Thought: If 'stocks only go up,' why does every earnings call sound like a hostage video? Modern finance in a nutshell.
Meet Your ETF AI Analyst
- Discover how TipRanks' ETF AI Analyst can help you make smarter investment decisions
- Explore ETFs TipRanks' users love and see what insights the ETF AI Analyst reveals about the ones you follow.
Home Depot (HD), which is the fourth-largest component in the Dow Jones with a 4.73% weight, will kick things off, reporting its earnings on Tuesday before the market open. The next day, Nvidia (NVDA), with a 2.44% weight, will report its earnings after the close, followed by Walmart (WMT) with a 1.35% weight on Thursday.
Another key event this week is the September jobs report, which includes nonfarm payrolls and the unemployment rate, on Thursday at 8:30 a.m. Eastern Time. The data, delayed from the government shutdown, will provide a much-needed update on the state of the labor market ahead of the Fed interest rate decision on December 10. Data released by the private sector during the shutdown, such as Challenger, Gray & Christmas reporting October layoffs at a 22-year high, hinted at continued jobs weakness.
The odds of a 25 bps rate cut next month have plummeted during the past month after several Fed officials addressed concerns about the labor market and inflation. On Monday, Fed Vice Chair Philip Jefferson backed the Fed taking a “prudent approach” to monetary policy.
“The evolving balance of risks underscores the need to proceed slowly as we approach the neutral rate,” Jefferson said. When rates are neutral, they neither boost nor hinder economic activity.
The Dow Jones is down by 0.15% at the time of writing.
Which Stocks are Moving the Dow Jones?
Let’s pivot to TipRanks’ Dow Jones Heatmap, which illustrates the stocks that have contributed to the index’s price action.
Nvidia (NVDA) is in the red ahead of its earnings, shrugging off a positive note from DA Davidson. The firm reiterated its $250 price target and called for “overwhelming demand for AI compute.”
Meanwhile, Johnson & Johnson (JNJ) is trading higher after the company announced it WOULD acquire Halda Therapeutics for $3.05 billion in cash. The transaction is expected to close within the next few months.
Elsewhere, Boeing (BA) is flat after Ethiopian Airlines and Air Senegal announced an order of 11 737-8jets and nine 737 MAX jets, respectively. Furthermore, Amazon (AMZN) is in negative territory after disclosing that it would seek to raise $12 billion through bond sales.
DIA Stock Moves Lower with the Dow Jones
The SPDR Dow Jones Industrial Average ETF (DIA) is an exchange-traded fund designed to track the movement of the Dow Jones. As a result, DIA is falling alongside the Dow Jones today.
Wall Street believes that DIA stock has room to rise. During the past three months, analysts have issued an average DIA price target of $533.67, implying upside of 13.16% from current prices. The 31 holdings in DIA carry 29 buy ratings, two hold ratings, and zero sell ratings.
