The Dow Jones Industrial Average index crossed the 40,000 point mark on Thursday for the first time in its history.
This is an important and symbolic milestone for the index that tracks 30 of the most valuable publicly traded companies in the United States.
The Dow is now up about 6% year to date.
The recent rally in the Dow Jones, SThe &P 500 Index and Nasdaq were boosted by data showing inflation is slowing, which would allow the Federal Reserve to begin its long-awaited interest rate cuts.
Inflation data released Wednesday showed price rises slowed slightly from the annual rate recorded the previous month, ending an inflation surge that dated back to early 2024.
In recent months, the Fed has all but abandoned its previous forecast of three-quarter point rate cuts this year. But the slowdown in price increases offers hope of reviving these projects.
“The combination of a Fed likely to cut interest rates because inflation is moderating and a resilient economy is a nice scenario for a bull market,” said Ed Yardeni, president of the financial advisory firm market Yardeni Research and former chief investment strategist at Deutsche Bank in the United States. equities division, told ABC News.
“It’s nicer to say that the market is going towards these nice round numbers in record territory rather than coming back towards them,” Yardeni added.
Wednesday’s inflation news sent each of the major stock indexes up more than 5% for the day, propelling them all to record highs. Thursday, at the start of the session, the Dow Jones had gained a quarter of a percentage point.
Observers have also attributed this year’s stock market rally to a rise in the value of some large technology companies, largely driven by enthusiasm over artificial intelligence.
ABC News
