Dow Jones, the S&P 500, and Nasdaq ahead of U.S. job report

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Wall Street’s three main indexes advanced for a second week in a row, but the uncertainty of potential outcomes between Ukraine and Russia continues to worry investors.

NATO, E.U., and G-7 leaders had a meeting last week, and U.S. President Joe Biden said that the “free world” opposes Russia’s invasion of Ukraine.

NATO leaders agreed to activate its chemical and nuclear defense units in light of a potential chemical attack by Russian forces in Ukraine, but NATO chief Jens Stoltenberg confirmed that NATO would not send troops or deploy jets in Ukrainian territory.

That would cause even more destruction; still, NATO will continue to provide advanced air defense systems, anti-tank weapons, ammunition, and fuel to Ukraine.

It is also important to mention that the U.S. agreed to increase liquid natural gas exports to the E.U. by 15 billion cubic meters in 2022 year in order to reduce the E.U.’s dependence on Russian energy.

The S&P 500 rose 1.8% for the week, the Dow added 0.3%, and the Nasdaq gained 2% even though the U.S. central bank surprised market participants with hawkish announcements for the upcoming meetings.

Fed Chair Jerome Powell said interest rates could rise quicker than previously expected to combat high inflation and raised the possibility of a 50-basis-point hike in rates in May.

Jerome Powell warned that “inflation is much too high,” which triggered a government bonds sell-off and sent yields to their highest since May 2019.

The war between Russia and Ukraine also poses a risk to inflation, and Morgan Stanley expects the Federal Open Market Committee to lift the target rate by 50 basis points in both May and June. Morgan Stanley reported:

Gasoline prices were among the main contributory factors in the most recent surge in the monthly inflation print to a four-decade high. The average cost of gasoline has risen 48% from a year ago to $4.24 a gallon.

Next week, the U.S. will publish the final reading of the Q4 Gross Domestic Product and monthly employment figures for March. The job report is expected to show that the country added 450K new jobs in March, while the unemployment rate should be around 3.7%.

S&P 500 up 1.8% on a weekly basis

For the week, S&P 500 (SPX) booked a 1.8% increase which marked the S&P 500’s second weekly gain in a row.

Data source: tradingview.com

The risk of another decline still persists, but if the price jumps above 4,600 points, it could reach 4,800 points very soon.

4,200 points represent the strong support level, and if the price falls below it, it would be a “sell” signal, and we have the open way to 4,000 points.

DJIA up  0.3% on a weekly basis

The Dow Jones Industrial Average (DJIA) advanced 0.3% for the week and closed at 34,861 points.

Data source: tradingview.com

The Dow Jones Industrial Average is still trading below its highs registered last month, and the current resistance level stands at 35,000 points.

The current support level stands at 34,000 points, and if the price falls below this level, it would be a “sell” signal.

Nasdaq Composite up 2% on a weekly basis

For the week, the Nasdaq Composite (COMP) booked a 2% increase and closed at 14,169 points.

Data source: tradingview.com

Even with last week’s gains, the Nasdaq Composite has plunged by more than 10% so far this year, and if the price falls again below 13,500 points, it would be a strong “sell” signal.

Summary

Wall Street’s three main indexes advanced for a second week in a row, but the uncertainty of potential outcomes between Ukraine and Russia continues to worry investors. The U.S. will publish the monthly job report on Friday, and investors will continue to pay attention to the Federal Reserve commentaries looking for any clues.

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