The Dow Jones Industrial Average (DIA) reached an unprecedented peak, closing at an all-time high following the release of new data indicating a continued decline in inflation in the United States, moving closer to the Federal Reserve’s 2% target.
On September 27, the Dow, which consists of 30 prominent blue-chip stocks and serves as a barometer for the U.S. economy, gained 137 points, or 0.3%, finishing at 42,313.00. This marks the 32nd occasion this year that the index has closed at a record level.
The latest surge was fueled by the Federal Reserve’s preferred inflation measure, the Personal Consumption Expenditures (PCE) index, which revealed a cooling trend in consumer prices for August, with an annualized rate of 2.2%. This figure is approaching the central bank’s 2% inflation target. In addition, core inflation, which excludes the more volatile food and energy sectors, experienced a rise of 2.7% in August.
Market sentiment has remained strong since the Fed’s decision to cut interest rates by 50 basis points on September 18. While the benchmark S&P 500 index dipped slightly by 0.18% on September 27, it has achieved multiple record highs since the rate cut and hints at further reductions in the near future.
Meanwhile, in Asia, China’s CSI 300 stock index surged by 4.5% on September 27, concluding the week with a remarkable 16% gain—the largest weekly increase since 2008. Similarly, Hong Kong’s Hang Seng Index recorded its most significant weekly rise since 1998. This rally in Chinese stocks was largely driven by announcements of government stimulus measures aimed at bolstering the domestic economy.
Gold prices are also on the rise, with the precious metal poised for its largest quarterly increase on record.
The SPDR Dow Jones Industrial Average ETF Trust, an exchange-traded fund that mirrors the movements of the Dow 30 index, currently holds a consensus Hold rating among 61 Wall Street analysts. This rating reflects 50 buy recommendations and 11 hold ratings issued over the past three months. The average price target of $468.47 suggests a potential upside of 10.76% from current trading levels.
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