Dow Jones futures fell 0.12% to trade near 49,150 during the European session on Tuesday, while the S&P 500 remained flat around 6,940, and Nasdaq 100 futures rose 13% to trade above 25,600. Dow Jones futures decline as traders may take profits or adjust their positions. Furthermore, continued uncertainty over economic and geopolitical developments and mixed market signals are weighing on the index.
The Dow rose 1.23% to a new record high on Monday, driven by strong gains in energy and financial stocks after President Donald Trump encouraged U.S. companies to invest in Venezuela’s massive oil sector. Chevron shares jumped 5.1%, and Goldman Sachs shares rose 3.7%, leading the index higher.
Wall Street rose in regular US trading on Monday with investors largely ignoring geopolitical risks following the US arrest of Venezuelan President Nicolas Maduro. The S&P 500 and Nasdaq Composite rose 0.64% and 0.69%, respectively, supported by gains in technology stocks, with Tesla stock rising 3.1% and Amazon stock rising 2.9%.
Minneapolis Fed President Neel Kashkari said inflation remains very high, although it is gradually declining. Speaking to CNBC on Monday, Kashkari noted that the Fed is likely to approach a neutral rate, warned that the unemployment rate could rise from here, and said he expects the economy to remain resilient. Traders are awaiting this week’s US labor market report, including the Non-Farm Payrolls (NFP) report, for signals on the outlook for monetary policy. The consensus forecast is for nonfarm payrolls to rise by 55,000.
The US ISM Manufacturing Purchasing Managers’ Index (PMI) fell for the third straight month, falling to 47.9 in December 2025, the lowest since October 2024, from 48.2 in November and below expectations of 48.3. The data indicates a faster contraction in manufacturing activity in the United States, driven by lower production and inventories.
Dow Jones FAQs
The Dow Jones Industrial Average is one of the oldest stock market indexes in the world, consisting of the 30 most actively traded stocks in the United States. The index is price-weighted and not market capitalization-weighted. It is calculated by summing the component stock prices and dividing them by a factor that currently amounts to 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years, it was criticized for not being broadly representative enough because it tracks only 30 conglomerates, unlike broader indices such as the S&P 500.
There are many different factors that drive the Dow Jones Industrial Average (DJIA). The overall performance of the constituent companies disclosed in the company’s quarterly earnings reports is the headline performance. US and global macroeconomic data also contribute to its impact on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also affects the Dow Jones Industrial Average because it affects the cost of credit, on which many companies rely heavily. Therefore, inflation can be a key driver along with other metrics that influence the Fed’s decisions.
Dow Theory is a method of determining the fundamental trend of the stock market developed by Charles Dow. The basic step is to compare the trend of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Size is a confirmatory criterion. The theory uses elements of peak and trough analysis. Dow Theory postulates three phases of a trend: accumulation, when smart money starts buying or selling; Public participation, when the wider public joins in; And distribution, when the smart money comes out.
There are a number of ways to trade the DJIA. The first is the use of ETFs that allow investors to trade the Dow Jones Industrial Average as a single security, rather than having to buy shares in all 30 component companies. A leading example of this is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures allow traders to speculate on the future value of an index and options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to purchase a share of a diversified portfolio of DJIA stocks and thus provide exposure to the overall index.
