Dow Jones Forecast: DJIA rises as Oil slips and Treasury yields pause

US futures        

Dow futures 0.25%, S&P 500 futures 0.34%  & Nasdaq futures  0.46%

European futures

FTSE 1.12%,  DAX  1.34%

• US stocks Rise cautiously after two days of declines.
• Oil prices fall, and treasury yields steady at 5.25%.
•  SpaceX deal pulls telecoms sharply lower.
• Oil Falls, but is still set to rise across the week

U.S. Stocks Rise as Oil Prices Ease on Calming Middle East Tensions

U.S. stocks are rising on Friday as oil prices ease on signs of reduced Middle East supply risks, although the telecom sector remains under pressure following SpaceX’s acquisition deal.

Oil prices are falling after President Trump said the U.S. would not attack Iran ahead of next month’s midterm elections, easing fears of further escalation in the region. Treasury yields have also steadied, with the benchmark 10-year yield holding around 5.25%, not far from the 24-year high of 5.364% reached on Wednesday.

Both the S&P 500 and Nasdaq are on track for weekly gains, despite falling over the past two sessions. Optimism is building ahead of what could be a solid, AI-driven Q3 earnings season, helping support equities despite elevated borrowing costs.

After Federal Reserve Governor Christopher Waller suggested there may be a need for another rate hike, he also indicated flexibility over its timing. Markets are pricing in just a 20% chance of an October hike, rising to an 85% probability of a hike by year-end.

Earnings season gathers pace next week, with major U.S. banks reporting results. U.S. CPI data will also offer further clues on the Fed’s policy path.

Corporate Movers

SpaceX is rising 3.7% after the rocket and satellite maker struck a deal to acquire a nationwide low-band spectrum portfolio, setting up a direct challenge to established wireless providers across the U.S.

Telecom firms are trading lower in response, with T-Mobile and AT&T both falling around 6%.

Apple is down 1.8% following media reports that the iPhone maker has told some suppliers to cut production of components for its newly launched iPhone 18 Pro and 18 Pro Max. Rising memory chip costs and higher prices may be weighing on consumer demand.

Dow Jones Forecast – Technical Analysis

The Dow Jones continues to trade within a descending channel dating back to 5 August. The index is finding support above the 200 EMA, while yesterday’s hammer candle, with its long lower wick, suggests buyers stepped in at lower levels. This could indicate a near-term floor, although further gains are needed to confirm a recovery.

Buyers would need to break above 51,500, the weekly high, to bring the 50 EMA and the upper boundary of the falling channel near 52,000 into focus. A move above this area would make the outlook more constructive, with attention turning to 53,700, the September high.

On the downside, sellers would need to break below the 50,500 weekly low and the 200 EMA to regain momentum, opening the door towards 50,000.

FX Markets – Dollar Holds Near 18-Month High

The U.S. dollar is holding steady as Treasury yields remain elevated. It has been a volatile week in the bond market, with both 10-year and 30-year Treasury yields reaching 24-year highs. Waller’s more measured comments suggest the Fed has some flexibility over the timing of any further rate hike, helping limit additional upside in the dollar.

EUR/USD is trading quietly above 1.1200 on Friday, supported by falling oil prices. However, concerns over France’s rising debt burden and political gridlock ahead of next year’s election could limit the pair’s upside.

GBP/USD is little changed around 1.3235, with gains constrained by rising UK fiscal concerns. Long-term UK borrowing costs have reached their highest levels since the 1990s, ahead of the government’s first budget later this month. In a speech yesterday, Bank of England Governor Andrew Bailey warned that a credible fiscal policy is needed more than ever.

Oil falls but is set to rise across the week

Oil prices are falling on Friday as supply concerns ease after President Trump said the U.S. would not attack Iran ahead of next month’s midterm elections. He also pointed to productive talks aimed at ending the war.

Brent crude is still on track to rise over the week following yesterday’s 4% jump, while WTI is heading for a slight weekly decline.

However, any sustained easing in prices will depend on concrete progress in negotiations and an improvement in shipping through the Strait of Hormuz. Oil markets remain highly volatile amid continued threats to shipping in the Gulf, even as supply from the Middle East has improved compared with the start of the war.

Elsewhere, a hurricane in the Gulf of Mexico is adding to supply risks. Producers have shut down around 1.3 million barrels per day of output, providing further support to prices.