Professor Ali Gamal Abdelgawad: The Dow Jones Industrial Average (DJIA)

• بواسطة دكتور علي جمال عبد الجواد
• 2025 Nov 28
• 1268

 

Prepared by: Professor Ali Gamal Abdel Gawad – Lecturer of Investment and Finance.

The Dow Jones: A Comprehensive Look at One of the World's Most Important Indices

The Dow Jones Industrial Average (DJIA) is one of the oldest and most important indices in the global markets. It reflects the state of the US economy and sets trends for investors worldwide. As 2025 draws to a close, the Dow Jones continues to play a key role amidst a volatile economic environment characterized by both bearish expectations and cautious optimism.

First: An Overview of the Index and Its Importance

The Dow Jones comprises 30 major companies, representing some of the largest and most powerful entities in the United States. These companies span the technology, industrial, financial, healthcare, and consumer sectors.

Despite its relatively small number of companies, its impact is significant because it includes companies that represent a substantial portion of the global economy.

Second: The General Outlook for the Dow Jones in 2025

During 2025, the index experienced frequent fluctuations due to:

Changes in US interest rates.

Volatile inflationary pressures.

The mixed performance of major companies, which ranged from strong to weaker-than-expected results.

Geopolitical tensions cast a shadow over risk appetite.

Despite these fluctuations, the Dow maintained a generally moderate upward trajectory, supported by the strength of the industrial and technology sectors.

Third: Fundamental Analysis of the Index

1. Strong Earnings of Large Companies

Most companies within the Dow were able to maintain stable earnings, particularly in the following sectors:

Technology

Defense and Military Industries

Healthcare

Major Banks

These sectors are typically less affected by crises, which supported the index.

2. Impact of Monetary Policy

The Federal Reserve's decisions in 2025 were the most important factor.

Any indications of a potential interest rate cut spurred liquidity flows into the Dow, while hints of a tightening policy triggered profit-taking.

3. Oil and Commodity Prices

Rising energy prices supported oil and industrial companies within the index, while putting pressure on companies with high operating costs.

Fourth: Technical Analysis of the Dow Jones Index

Note: Figures are approximate and reflect general technical trends during 2025, without relying on real-time data.

General Trend

Medium-Term Trend: Upward

Short-Term Trend: Volatile

Long-Term Trend: Positive and Stable

Expected Support Levels

Strong support around the 32,000 area

Secondary support near 33,500

These levels have proven their strength in several months this year.

Expected Resistance Levels

Major resistance near 36,000

Historical resistance around 37,000

Breaking through these levels typically gives the index a strong boost towards new highs.

Key Technical Indicators

The Relative Strength Index (RSI) indicates a balanced movement between buying and selling.

The moving averages are moving consistently and support the upward trend.

Trading volume reflects a gradual return of confidence after periods of volatility.

Fifth: Key News Influencing the Index in 2025

Among the most prominent factors that have impacted the Dow's trajectory are:

Monthly US jobs reports.

Earnings results, particularly from major technology companies.

Political and economic tensions between the US and China.

Energy sector trends and production agreements.

Developments in artificial intelligence and companies entering a new wave of investments.

Sixth: Future Outlook for the Dow Jones

Bull Scenario

Gradual interest rate cuts.

Stabilized inflation.

Continued corporate earnings growth.

In this scenario, the index could experience a strong upward surge to new highs.

Break Scenario

A slowdown in the US economy.

Pressure on the technology sector.

A sudden monetary tightening.

This scenario could trigger corrections in the index, but these are typically temporary.

Conclusion

In 2025, the Dow Jones continues to solidify its position as a strong index during times of volatility, relying on the strength of its industrial and financial companies. With markets expecting a return to monetary stability in the future, the index may be heading towards a positive phase, but with caution and constant monitoring of economic data.

• الوسوم
• Professor
• Ali
• Gamal
• Abdelgawad:
• The
• Dow
• Jones
• Industrial
• Average
• (DJIA)
• Professor Ali Gamal Abdelgawad: The Dow Jones Industrial Average (DJIA)