Team Blitz India
The Dow Jones Industrial Average surpassed the 40,000 level on May 16 for the first time, hitting record intraday high for the third straight day, amid hopes of interest rate cuts in the US and strong corporate earnings. The Dow rose as high as 40,051.05 while the S&P 500 and Nasdaq also hit record highs in early New York trading before paring gains and ending the session slightly lower.
The Dow Jones comprises 30 major companies including Apple, Walmart, and Boeing. The index has gained nearly 6% year-to-date (YTD). The index first closed above 30,000 in November 2020. Data showed cooling consumer price inflation, but that was offset by news that US jobless claims fell in the latest week and by figures showing US import prices increased 0.9% last month, Reuters reported.
Investors are betting on two quarterpoint interest rate cuts from the Federal Reserve this year, and estimate a 70% chance of the first reduction in September, according to the CME FedWatch Tool.
“What (the Dow hitting 40,000) means is that regardless of the concerns about inflation and consumer sentiment, the companies in the Dow, which represent a cross section of our economy, continue to march higher on better earnings and stronger guidance,” Quincy Krosby, chief global strategist at LPL Financial in Charlotte, North Carolina told Reuters.
All three Wall Street indices pared gains and the Dow Jones Industrial Average ended 38.62 points, or 0.10%, lower at 39,869.38, while the S&P 500 fell 11.05 points, or 0.21%, to close at 5,297.10. The Nasdaq Composite settled 44.07 points, or 0.26%, down at 16,698.32.
