Dow Jones index today: Dow Hit Record Closing Highs

The Dow Jones index, one of the oldest stock market indices globally, comprises the 30 most actively traded stocks in the US. Unlike capitalization-weighted indices, the Dow is price-weighted, meaning it is calculated by adding the prices of its constituent stocks and dividing by a factor, which currently stands at 0.152. Founded by Charles Dow, who also established the Wall Street Journal, the index has faced criticism over the years for its limited representation, as it only tracks 30 conglomerates compared to broader indices like the S&P 500.

The S&P 500 and Dow Jones Industrial Average both hit record closing highs, rising 0.7% and 1%, respectively, while the Nasdaq Composite gained 0.6%. Major indexes have rebounded from a steep selloff to start the week as technology stocks have gained and oil prices have fallen.

Boeing (BA) shares declined by 3.4%, leading the decliners in the Dow, following a breakdown in negotiations between the company and the union representing striking workers.

As investors gear up for the earnings reporting season, which begins in earnest on Friday with quarterly results from several major banks, there’s significant anticipation surrounding Tesla's (TSLA) robotaxi event and Advanced Micro Devices' (AMD) 'Advancing AI' event on Thursday. However, today’s corporate news calendar has been relatively quiet.

Dow Jones Industrial Average adds 450 points

The Dow Jones Industrial Average (DJIA) surged by another 450 points on Wednesday, continuing its bullish turnaround after an early-week decline that briefly pushed the major equity index below 42,000. Despite a lower-than-expected report on August Wholesale Inventories and a tepid appearance from Federal Reserve Bank of Dallas President Lorie Logan, investors remained active in the market.

US Wholesale Inventories increased by only 0.1%, falling short of expectations, which had anticipated a hold at July’s figure of 0.2%. The report presented mixed results: while non-durable goods inventories decreased by 0.1%, contrary to the expected 0.5% increase, durable goods inventories rose more than anticipated, climbing by 0.3% compared to the previous month's 0.1%. This trend indicates that US consumers are shifting their spending towards non-durable goods while reducing investment in long-term purchases.

Dow Jones price forecast

The Dow Jones continues to outperform its own averages, consistently trading above the 50-day Exponential Moving Average (EMA) and remaining near record highs. Recent price action has hovered close to the peak bids from late September, and a bearish pullback that ultimately proved inconsequential has left momentum indicators poised to flip into buy signals once again.

Currently, the Dow Jones is up approximately 6.25% from its swing low in September, around the 40,000 mark, with intraday trading maintaining levels just above 42,000. Year-to-date, the major equity index has returned 12.75%, with half of those gains coming just from September alone.

Federal Reserve's September meeting effects Dow Jones price

The Federal Open Market Committee’s (FOMC) Meeting Minutes from the September rate decision revealed little new information, as many market participants had anticipated. The minutes indicated that "most" policymakers supported a 50 basis point cut, while acknowledging that "some" members preferred a quarter-point reduction. This likely refers to Fed Governor Michelle Bowman, who was the sole dissenter against the decision to implement a substantial half-percent cut, marking the first time in decades that a Fed official objected to an otherwise unanimous policy decision.

Overall, this decision provided a substantial push to investor confidence, overshadowing ongoing geopolitical tensions and a disappointing trading session in China, where profit-taking led to significant declines. the FOMC Meeting Minutes reaffirmed the Fed's "data dependent" approach, emphasizing that any future policy changes will hinge on shifts in economic data as November approaches.

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Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.