- The Dow Jones found a fresh all-time peak at the start of the week.
- Investors have leaned firmer into risk appetite ahead of a hefty earnings week.
- The Dow Jones has gained over 12% from August’s swing low.
The Dow Jones Industrial Average (DJIA) climbed to another record high on Columbus Day Monday, testing above the 43,000 handle and poised to enter a sixth consecutive week in the green. Wall Street is geared up for a hectic earnings reporting week, and this week’s US data docket is a smattering of mid-tier Federal Reserve (Fed) policymaker appearances with key US Retail Sales figures slated for Thursday.
JPMorgan Chase (JPM) and Wells Fargo (WFC) kicked off earnings season late last week on the high side, and markets are hoping for more of the same from the rest of the banking sector. Bank of America (BAC) and Goldman Sachs (GS) will be reporting Q3 earnings on Tuesday, joined by pharma giant Johnson & Johnson (JNJ). Morgan Stanley (MS) will round out finance sector earnings on Wednesday alongside United Airlines (UAL), with Walgreens Boots Alliance (WBA), Netflix (NFLX), and Proctor & Gamble (PG) due later in the week.
Dow Jones news
Despite a firm leg higher into bull country, the Dow Jones was relatively balanced during Monday’s US market session, with roughly half of the equity index’s constituent securities testing into the red. Losses were lead by Caterpillar (CAT) which fell nearly 2% and slipped below $395 per share as construction stocks waffle following a notable lack of gunpowder behind recently-announced Chinese stimulus measures meant to bolster China’s lagging housing and construction markets.
On the high side, Travelers Companies (TRV), Unitedhealth Group (UNH), and Mcdonald’s (MCD) are competing for the top spot, with all three companies rising around 1.5%. Travelers Companies rose to $240 per share, with Unitedhealth crossing above $606 per share and McDonald’s climbing toward $310 per share.
Dow Jones price forecast
The Dow Jones continues to push through key resistance levels and extend bullish momentum into record levels. With the Dow breaking through September’s technical barriers and crossing over 43,000, the next target for bulls will be the 44,000 psychological level.
The Dow Jones has gained nearly 8% from September’s swing low into the 50-day Exponential Moving Average (EMA), rallying firmly from a test of the 40,000 handle. The major equity index continues to grind out chart paper north of the 200-day EMA rising into 39,400, and bidders have refused to let price action touch the long-run moving average since November of 2023, when the Dow Jones was grappling with 34,000.
Dow Jones daily chart
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD extends recovery beyond 1.0400 amid Wall Street's turnaround
EUR/USD extends its recovery beyond 1.0400, helped by the better performance of Wall Street and softer-than-anticipated United States PCE inflation. Profit-taking ahead of the winter holidays also takes its toll.
GBP/USD nears 1.2600 on renewed USD weakness
GBP/USD extends its rebound from multi-month lows and approaches 1.2600. The US Dollar stays on the back foot after softer-than-expected PCE inflation data, helping the pair edge higher. Nevertheless, GBP/USD remains on track to end the week in negative territory.
Gold rises above $2,620 as US yields edge lower
Gold extends its daily rebound and trades above $2,620 on Friday. The benchmark 10-year US Treasury bond yield declines toward 4.5% following the PCE inflation data for November, helping XAU/USD stretch higher in the American session.
Bitcoin crashes to $96,000, altcoins bleed: Top trades for sidelined buyers
Bitcoin (BTC) slipped under the $100,000 milestone and touched the $96,000 level briefly on Friday, a sharp decline that has also hit hard prices of other altcoins and particularly meme coins.
Bank of England stays on hold, but a dovish front is building
Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.