Dow Surges 500+, Surmounts 42,000 for First Time
September 19,2024 04:28 pm EST
Stocks jumped Thursday, with the Dow Jones Industrial Average and S&P 500 rising to new all-time highs, as traders cheered the Federal Reserve's Wednesday decision to lower interest rates by a half percentage point.
The 30-stock index ballooned 522.09 points, or 1.3%, to 42,025.19, its first close above the 42,000 threshold.
The much-broader index piled on 95.38 points, or 1.7%, to 5,713.63, topping 5,700 for the first time.
The NASDAQ jumped 440.68 points, or 2.5%, to 18,013.98.
Traders got some validation that the Fed was engineering a soft landing for the economy on Thursday as weekly jobless claims fell by 12,000 to 219,000, which was far below estimates.
Tech stocks rallied as the rate cut spurred investors to return to a risk-on mood. Nvidia added 4% and AMD shares popped nearly 6%. Micron Technology added 2.2%. Other big tech stocks such as Meta Platforms took on 3.9% and Alphabet advanced1.5%.
Stocks leveraged to lower rates spurring the economy also jumped Thursday. Financial giant JPMorgan Chase rose 1.4%. Industrial stock Caterpillar grabbed 5.1% and Home Depot gained 1.7%.
The Fed slashed its overnight lending rate to a range of 4.75% to 5% from 5.25% to 5.5% on Wednesday, which came as a surprise to some investors who criticized the size of this initial cut. This is the first rate reduction delivered by the Fed in four years.
Prices for the 10-year Treasury sagged, lifting yields to 3.73% from Wednesday's 3.71%. Treasury prices and yields move in opposite directions.
Oil prices took on $1.07 to $71.98 U.S. a barrel.
Gold prices strengthened $13.00 to $2,611.60.
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