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Published: 31 July 2026,06:09
Daily Market Analysis New
Key Takeaways:
*U.S. equities recovered strongly after the PCE Price Index, the Fed’s preferred inflation measure, came in softer than expected at 3.7%, reinforcing Fed dovish expectations.
*Strong earnings from Apple, Microsoft, Amazon, and Meta Platforms helped revive sentiment across the technology sector, providing a significant boost to the previously underperforming Nasdaq Composite.
*Lower inflation pressures and resilient corporate earnings have improved the outlook for U.S. equities, although investors will continue to monitor upcoming economic data and corporate guidance for signs of trend recovery.
Wall Street reversed its recent downtrend in the last session, supported by a combination of softer-than-expected U.S. economic data and encouraging results from major technology companies. The Personal Consumption Expenditures (PCE) price index, the Federal Reserve’s preferred inflation gauge, came in at 3.7%, lower than the previous reading. This moderation, coupled with the more dovish tone from the Wednesday FOMC decision — where a majority of board members favoured a steady policy stance — has reinforced market expectations that the Fed may keep interest rates unchanged for a longer period. The reduced urgency for further tightening has provided a constructive backdrop for risk assets, particularly equities.
Adding to the positive momentum, highly anticipated earnings reports from technology giants Apple, Microsoft, Amazon, and Meta Platforms largely met or exceeded market expectations. These results have helped catalyse a rebound in the previously bearish Nasdaq Composite, which had faced significant pressure throughout July due to concerns over elevated AI capital spending and valuation levels. Strong performances from these heavyweight constituents offered reassurance on demand trends, cloud growth, and operational resilience, encouraging investors to re-engage with the technology sector.
In the near term, the U.S. equities market, especially the Nasdaq, appears better supported following this combination of cooler inflation data and solid corporate results. However, sustainability of the rebound will depend on whether the softer inflation trajectory continues and whether upcoming economic releases or further earnings commentary reinforce the current narrative. Any reacceleration in price pressures or signs of softer guidance from remaining tech reports could reintroduce volatility. Overall, the recent session marks a notable shift in sentiment, with the Fed’s preferred data and megacap strength providing key catalysts for the recovery.
Technical Analysis
Nasdaq has staged a strong technical rebound, rallying nearly 5% from its recent low below the 27,000 mark. The sharp recovery has allowed the index to reclaim the key 28,000 liquidity zone, a development that suggests a potential bullish trend reversal and a significant improvement in market sentiment.
The breakout above this liquidity zone indicates that buyers have regained control in the near term, shifting the momentum in favor of the bulls. While the recent surge may prompt a period of minor technical retracement or consolidation, such a pullback would likely be viewed as a healthy correction within the broader recovery trend.
The 28,000 level now serves as a critical support zone. As long as Nasdaq remains supported above this area, the bullish outlook is expected to remain intact. A successful defense of this level would reinforce the validity of the breakout and increase the likelihood of further upside momentum.
Should the index continue to hold above 28,000, Nasdaq is expected to extend its current recovery and trade higher, potentially attracting additional buying interest as confidence in the bullish reversal strengthens.
Resistance Levels: 28,550.00, 29,590.00
Support Levels: 27,420.00, 26,160.00
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