The Dow is now down 1,100 points in three days.
At the moment, the Dow Jones is down another 208 points. The NASDAQ is down 52, as the S&P 500 slips another 20 points. With little to get excited about, the Dow could slip another 2,000 points as we noted just yesterday.
Not only did ISM data point to slowing growth, but private sector jobs growth is slowing. We have the trade war with China, and now the European Union. There are fears Congress will become overly occupied with talk of impeachment.
The icing on the cake – a disappointing services economy reading
Granted, the services sector did expand in September. But it did so at a much slower pace than expected, according to the ISM Non-Manufacturing Index just released. The closely watched number just fell to 52.6, which is less than the expected 55.3. Compounding the problem, this comes amid worries the economy faces a potential recession with slowing growth.
“Bottom line: Elevated uncertainty is threatening economic confidence after September’s stock market bounce ran out of steam,” said Willie Delwiche, investment strategist at Baird said, as quoted by CNBC. “The manufacturing sector continues to weaken. CEO confidence is at its lowest level in a decade and the pace of private sector job growth is slowing.”
Buckle Up – We Just Broke the 200-day Moving Average
With tensions building, the Dow Jones just broke below its 200-day moving average.
Now, if it fails to hold triple bottom support at 25,500, the DJIA could potentially test a low of 24,680 set back in early June 2019. After that, the next line of support is 24,323. After that, we could see lows not seen since January 2019.
Should that happen, the Dow will lose another 2,700 points. Stay safe.
