DJIA snaps a losing streak as indices close at 2019 high on optimism over trade and US government shutdown

• The Dow Jones Industrial Average adding 372.65 points, or 1.5%, to 25,425.76.
• The S&P 500 index put on 34.93 points, or 1.3%, to 2,744.73, (S&P 500 ended above its 200-day moving average for the first time in 46 days).
• The Nasdaq Composite Index advanced 106.71 points, or 1.5%, to 7,414.62.

Following news that the Democratic and Republican lawmakers had reached a deal late Monday, as well as positive progress sound bites from the Sino/US trade talks, the benchmarks on Wall Street rallied. The bilateral trade negotiations in Beijing sound to be going well, albeit in the early day's still considering it has only been two days between low-level negotiators. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer are due to arrive in Beijing on Thursday for high-level discussions ahead of the March 2 deadline.

Data impacts

"Data had little impact. US job openings jumped 169k in December to a record high 7.34mn, underscoring ongoing strength in the labour market. Service sector industries led the way while manufacturing saw fewer job openings, likely related to slower global growth and trade frictions. Employees remain upbeat about job prospects with the quits rate holding firm at 2.3%.

Less encouragingly, small business optimism fell to a two-year low in January, the lowest under Trump’s presidency. The National Federation of Independent Business’s optimism index fell 3.2pts to 101.2, the government shutdown a likely culprit along with ongoing trade tensions," analysts at Westpac explained. 

DJIA levels

The technical indicators in the DJIA have switched to positive with the index now asserting its self above the 200- D SMA and the 61.8% Fibo level. However, a break of the moving averages on the downside opens the 50% Fibo downside target located at 24215 meeting the 21st Jan fractal lows of 24243. However, and significantly, on the upside, the index managed a close above the trend reversal doji and recent peek and a break to the Sep lows and the 76.4% Fibo of the Sep decline at 25668 could be on the cards.