More gains ahead this week for Wall Street after Friday's record session?
The Dow reached above 40,000 points for the first time since May, thanks to growing expectations of a rate cut this year from the Fed, even after producer prices for June were a little hotter than expected.
The Dow added 247.15 points, or 0.62%, to close at 40,000.90. The S&P 500 gained 0.55% to finish at 5,615.35, while the Nasdaq Composite rose 0.63% to 18,398.45.
During the session, the 30-stock Dow rose to a fresh all-time high of 40,257.24. This was its first time above 40,000 since topping that milestone in late May.
During Thursday’s session, the S&P 500 posted its worst day since late April as investors sold their Big Tech winners in a major market rotation.
However, the Dow outperformed that day, inching higher by 0.08% during the sell-off in the other major averages.
On Friday, investors piled into the Dow's industrials on hopes that slowing inflation would be followed by a Federal Reserve rate cut in September. The Dow advanced 1.6% for the week.
For the year to date, the S&P 500 is up nearly 18%, thanks to big gains from Apple, Nvidia, Microsoft, Amazon, and Meta.
However, these big stocks haven’t helped the Nasdaq as much, which is up just under 9.9% year to date. The Dow is up 6% since the start of the year.
The outperformance of the S&P 500 is due to more than just the surge in the megatechs.
Eurozone shares rose 1.3%, and along with the Euro, they are back where they were before the EU elections. Japanese shares rose 0.7% (with news of a big intervention by the government to drive down the value of the yen on Friday).
Chinese shares rose 1.2% ahead of the delayed meeting of the country’s Plenum, which is supposed to meet fairly regularly to set policy guidelines for the year ahead but which was not held as planned in 2023. The plenum is due to start today (Monday) and run until Thursday.
Important Chinese economic data is also out today on growth, production, retail sales, and investment.
