Market Analysis: Dow Jones Hits May Lows

US30, or the Dow Jones index, which is calculated based on the value of shares of 30 companies traded on Wall Street, fell below 32,800.

This happened against the backdrop of growing concerns about raising the US national debt ceiling. Fitch has even placed the long-term AAA US rating on review. According to JPMorgan analysts, despite the fact that the most expected scenario is the increase in the debt ceiling, the probability of a default at the moment is 25% and is increasing every day.

US30 is faring noticeably weaker than the index of technology stocks, which are in demand in the context of the AI-related boom. For example, NVDA shares soared 25% to $380 after yesterday's report, and Nvidia sharply raised its revenue and profit forecasts due to the demand for AI chips (we wrote about NVDA's bullish outlook just a week ago).

The US30 chart shows that the index value has fallen into the lower zone of the channel it has been in since November 2022. If default anxiety builds, it is possible that the Dow Jones will continue to decline within the short-term channel (shown in red lines) towards the lows of the year.

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