Dow surges 300 points, closes above 26000 for first time
- Author: Zachary Reyes Jan 19, 2018,
Jan 19, 2018, 17:06
The US labour market has continued to strengthen and economic activity is rising at a solid rate, giving investors a solid push. Since then, Wall Street analysts have been boosting their 2018 earnings forecasts for USA companies at the quickest pace in a decade, providing a fresh tailwind for a market that some skeptics say is pricey.
The Dow Jones Industrial Average fell 10.33 points, or 0.04 percent, to 25,792.86, the S&P 500 lost 9.82 points, or 0.35 percent, to 2,776.42 and the Nasdaq Composite dropped 37.38 points, or 0.51 percent, to 7,223.69.
The blue-chip Dow gained 1.3 percent to close at 26,115.65 - just eight trading sessions after breaking the 25,000 mark - with strong showings from Boeing, IBM and Intel. The main indexes are still hovering near record levels.
The bronze sculpture of a bull that stands near the New York Stock Exchange serves as a symbol of Wall Street's power perhaps this year more than ever.
Other big banks on the earnings docket this week include Bank of America Corp (NYSE: BAC) and Goldman Sachs Group Inc (NYSE: GS), reporting ahead of the market open tomorrow, and Morgan Stanley (NYSE: MS) before the open Thursday. "What's held them back seems to be company-specific", said Shawn Cruz, senior trading specialist at TD Ameritrade in Chicago, making reference to General Electric.
"What was working last year is, to a large extent, working this year, " said Jonathan Golub, chief USA equity strategist at Credit Suisse.
Other negative catalysts on the horizon include the start of the Q4 2017 earnings report season and the Federal Reserve's looming policy meeting. Respondents were "optimistic" about 2018, as wages increased in most districts. The S&P financial index is up almost 5% to start the year. It ended above 25,000 on January 4. That means available money to buy stocks is shrinking.
In another sign of optimism, Wall Street analysts are boosting their earnings forecasts for USA companies at the fastest pace in 10 years, according to Bespoke Investment Group.
S&P 500 measures the performance of 500 widely held common stocks of large-cap USA companies. US Bancorp also posted better-than-expected results.
Robert Pavlik, chief investment strategist at SlateStone Wealth, said there were concerns in the market that stocks had risen too much too quickly. This is a bullish situation for the market. Historically, a government shutdown has led to a short-term pullback in the stock market.
"The Dow's performance in the first two weeks of 2018 has been nothing short of breathtaking", said Jesse Cohen, senior editor at Investing.com. In simple words; they were bigger and better than my team.
A link has been posted to your Facebook feed.
The Dow Jones Industrial Average crossed the 26,000 point milestone at the opening bell on Tuesday. (NASDAQ:ONCE) closed the previous trading session at $51.53, experiencing a change of 0.41% with 762,070 shares trading hands. BRYAN R. SMITH, AFP/Getty Images Traders work on the floor of the New York Stock Exchange.