Dow struggles to stay above 200-day moving average

The Dow Jones Industrial Average on Wednesday morning was struggling to trade above its 200-day moving average, with a powerful downturn driving the index more than 2% lower in opening trade. The Dow‘s 200-day moving average stands at 25, 558.99, according to FactSet data and the blue-chip gauge was trading down 532 points, or 2%, at 25,504 in recent action. Technical analysts use moving averages to determine long-term and short-term trends in an asset, with a breach of the 200-day viewed as a possible cessation of a bullish rally in the 123-year-old stock benchmark. The Dow hasn‘t closed below its 200-day moving average since early June. Meanwhile, the S&P 500 index was off 1.4% at 2,840, with its 200-day moving average at 2,791.14. Wednesday‘s decline was sparked by growing fears that global growth was grinding to a halt as a number of central banks cut interest rates in attempt to dampen the harm cause by a Sino-American trade war. Decline in equities came as government bond yields, which move inversely to their prices, were falling sharply, reflecting a flight to assets perceived as havens like bonds and stocks. The 10-year Treasury note hit a level at 1.60%, marking its lowest yield since October of 2016, according to Dow Jones Market Data.

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