The Dow Jones industrial average powered past a benchmark not seen since October 2018 as investors looked past cooling economic indicators to bet that rate cuts are inevitable. (Richard Drew/AP)
U.S. markets closed at new records in a shortened, pre-holiday session Wednesday after a disappointing report on private sector jobs increased investor optimism that the Federal Reserve will reduce interest rates later this month.
The Dow Jones industrial average climbed 179 points, about 0.7 percent, finishing the day at 26,966. The Dow broke its closing day record from Oct. 3, 2018, when it ended at 26,828.
Procter & Gamble, Cisco Systems and Merck & Co. were leading the Dow upward toward the close.
The Standard & Poor’s 500 index also closed at a new high on expectations for more Fed accommodation. The S&P finished the session at 2,995, up around 0.8 percent.
The tech heavy Nasdaq Composite ended the day at 8,170, a gain of about 0.8 percent.
Markets bounced on disappointing news on private sector job creation. Private companies reported adding 102,000 new jobs in June, below the 135,000 that were expected, according to a report from ADP and Moody’s Analytics.
The jobs miss fueled optimism by investors that the Federal Reserve will lower interest rates to help sustain the economic expansion, now in its 10th year.
“This weaker jobs number keeps the Fed at the table,” said Washington investor Michael Farr. “But this is not healthy. Anticipating more help from the government, rather than stronger fundamentals, is not healthy for investors and is the stuff of which bubbles are made.”
Stocks have popped all week, starting with a Monday surge after the United States and China reached a cease-fire on trade over the weekend, launching the second half of the year on a happy note.
All three U.S. stock indices are way up on the year and coming off one of their best Junes in decades.
https://www.washingtonpost.com/business/2019/07/03/dow-blasts-past-record-shortened-session-heightened-fed-expectations/
2019-07-03 17:09:34Z
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