The Dow surged above 27,000 points for the first time on Thursday (Jul 11), closing at a fresh record on optimism over an expected Federal Reserve interest rate cut later this month.
|Dow ends above 27,000 points for first time, S&P 500 hits record, (AFP Photo / Stan Honda / AFP)|
Shrugging off trade war worries, the blue-chip Dow Jones Industrial Average gained 227.88 points (0.85 per cent) to hit 27,088.08.
The broad-based S&P 500 ended up 6.84 points (0.23 per cent) at 2,999.91, also a record – though below the 3,000-point mark breached earlier this week – while the tech-rich Nasdaq Composite Index slipped 6.49 points (0.08 per cent) to 8,196.04.
The records – which were touted on Twitter by US President Donald Trump – came as Federal Reserve Chair Jerome Powell completed a second day of congressional testimony at which he emphasised economic risks in remarks that were widely interpreted as signaling a likely interest rate cut.
Trump, who has repeatedly criticised Powell on monetary policy, extolled the latest landmark on Twitter, saying “Dow just hit 27,000 for the first time EVER!”
But the new peak came amid fresh signs of trade policy discord that have troubled investors over the last year.
Trump, also on Twitter, accused China of backsliding on a recent pledge to buy more US farm exports. “Hopefully they will start soon!”
Trump’s latest tweet on China “means we are not closer to a deal with China,” said Art Hogan, chief market strategist at National Securities.
Health insurer UnitedHealth Group surged 5.5 per cent and CVS Health jumped 4.7 per cent after the Trump administration spiked a plan to curb drug rebates offered by pharma companies to middlemen.
But pharma giants Merck and Pfizer slumped 4.5 per cent and 2.5 per cent as the move still leaves them vulnerable to actions to curtail drug prices.
Delta Air Lines climbed 1.2 per cent as it reported a nearly 40 per cent surge in second-quarter profits to US$1.4 billion on strong flying demand.
The company also benefited from its lack of exposure to the Boeing 737 MAX, which has been grounded following two crashes. Delta does not own any of planes.
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