Dow Jones Forecast: DJIA rises, tech rebounds

US futures        

Dow futures 0.04%, S&P futures 0.4%  & Nasdaq futures  1%

European futures

FTSE -0.25%,  DAX  0.6%

• US stocks rise, boosted by tech stocks
• Nvidia earnings, core PCE inflation and Fed Warsh’s speech in focus
• US Treasury Secretary Scott Bessent announced economic D-Day on Iran
• Oil shrugs off Bessent’s comments

Stocks Rise Ahead of Nvidia Earnings and Jackson Hole

U.S. stocks are heading higher on Tuesday as Treasury yields fall and semiconductor stocks recover. Investors are positioning ahead of Nvidia's earnings tomorrow and the Federal Reserve's Jackson Hole symposium later this week.

The 10-year Treasury yield is down more than three basis points, extending yesterday's decline after reports that the U.S. Treasury could consider using its $1 trillion general account to fund further bond repurchases.

The prospect of additional liquidity is supporting risk assets, with chip stocks among the strongest performers pre-market.

Attention is now firmly on Nvidia, which reports after the close tomorrow. The results will provide another test of whether demand for AI chips and data-centre infrastructure remains strong enough to justify the huge investment cycle seen across the sector.

After Nvidia, the focus shifts to monetary policy. Core PCE, the Fed's preferred inflation gauge, is due Wednesday, followed by Fed Chair Kevin Warsh's speech at Jackson Hole on Friday.

Investors will be looking for clues over the outlook for interest rates. Warsh has generally avoided providing much forward guidance, so the speech may offer less clarity than markets would like.

However, with rate expectations still finely balanced, even a small change in his language around inflation or monetary policy could move Treasury yields, the dollar and equities.

Corporate Movers

AMD is up 2% after Raymond James upgraded the semiconductor company to Strong Buy from Outperform, with a $641 price target, implying around 40% upside.

Chip stocks are broadly higher, with Intel up 3% and Nvidia also gaining ahead of tomorrow's earnings.

Dick's Sporting Goods has plunged more than 12% after revenue missed expectations. The retailer reported sales of $5.59 billion, below the $5.65 billion expected.

Wall Street Forecast – Technical Analysis

The Dow Jones remains above its rising trend line and its 50 and 200 EMAs, keeping the broader trend constructive.

The index ran into resistance at the record high of 54,540 before pulling back towards 53,650. Despite the decline, the broader uptrend remains intact.

Buyers will look to reclaim 54,540 and then extend gains towards 54,750, the August 5 high.

Immediate support is around 53,300, the July high. A break below 52,825, last week's low, would put the rising trend line and 50 EMA at risk and could open the door to 52,000 and then 51,000, the July low.

FX Markets – Dollar steady, EUR/USD unchanged

The U.S. dollar is unchanged in a wait-and-see mood ahead of US core PCE data and Fed Chair Walsh’s speech on Friday.

EUR/USD is holding above 1.1650, supported by German GDP and economic sentiment data. German Q2 GDP rose 0.3% QoQ, beating forecasts of 0.2%.

GBP/USD is hovering near a six-month high as traders remain in wait-and-see mode. With little major UK data this week, sterling remains supported by expectations that the Bank of England could still raise rates this year.

Oil falls despite Bessent’s threats on Iran

Oil prices have fallen around 3% to a weekly low as traders look past the latest U.S. sanctions on Iran.

Treasury Secretary Scott Bessent announced measures aimed at economically isolating Iran but declined to identify which countries could be targeted.

The muted reaction in oil suggests markets currently see the latest sanctions as less of a threat to supply than a direct military escalation.

That doesn't mean the risk has disappeared. Iran could still respond by disrupting shipping, while traffic through the Strait of Hormuz remains at its lowest daily level since May.

There are also signs of potential diplomatic progress. Pakistan's Interior Minister said significant progress had been made in the latest round of talks aimed at restoring the memorandum of understanding between Iran and the U.S.

For oil, the next move is likely to depend on which story wins out: further disruption to shipping and supply, or genuine progress towards reopening the Strait of Hormuz.