To The Moon

Stocks made a significant push at the closing bell today, with the Dow Jones Industrial Average narrowly surpassing the 40,000 mark for the first time ever. The $DJIA(.DJI)$ closed at 40,003.59, edging over the threshold by just 3.6 points.

DJIA tops 40,000 before pulling back

DJIA

This milestone comes after an 874-trading-day journey from 30,000, led by substantial contributions from Goldman Sachs and $Microsoft(MSFT)$ , while companies like Walt Disney and 3M detracted from the index.

DJIA stocks

Market Overview

• Weekly Performance

Dow Jones Industrial Average: Up 1.2% for the week, reaching a historic high.

$S&P 500(.SPX)$ Increased by 1.5%, marking a four-week gain of 6.8%.

$NASDAQ(.IXIC)$ Rose by 2.1% this week, accumulating a 9.2% increase over the last four weeks. $NVIDIA Corp(NVDA)$ $Apple(AAPL)$

• Analysts’ Insights

- “UBS Global Wealth Management”, Predicts the Fed will cut rates by 50 basis points this year, with further reductions in 2025 and 2026, creating a favorable macro environment for quality bonds and stocks…

-”Blue Chip Daily Trend Report”, Expects the Dow to reach 42,500 by the end of the year if moderate inflation and slightly higher, but manageable, labor market weakness persist….

-”Fundstrat”, Anticipates positive developments from AI-related events and earnings, particularly from Nvidia and Microsoft, which could bolster technology stocks and the broader market…

• Earnings

- Over 90% of S&P 500 companies have reported first-quarter results, with 78% surpassing profit expectations.

- A decline in companies mentioning "inflation" during earnings calls suggests easing concerns about rising prices.

• Economic Data

China’s Property Market: The Chinese government announced measures to bolster the property market, including relaxing mortgage rules and urging local governments to purchase unsold homes. This includes a $42 billion funding package to convert excess inventory into affordable housing.

• Commodity Prices:

- Oil: Brent crude is trading around $84 per barrel, while WTI is around $79.51 per barrel.

- Gold: Prices rose to approximately $2,360 per ounce.

- Copper: Spot copper is trading at $9,900 per tonne.

Market Sentiment

The market is buoyed by expectations of Federal Reserve rate cuts, driven by a combination of easing inflation and strong earnings reports.

This optimism is reflected in the bullish outlook from market strategists, who foresee continued gains for stocks, particularly in the technology and AI sectors.

Optimism

Earnings season is slowing down but there are still notable results due from tech leaders and retailers next week. The highlight will come from Nvidia. The AI leader is due to report on Wednesday. 

Zoom Video reports on Monday, followed by AutoZone and Lowe’s on Tuesday. Target, TJX, and Snowflake are among the other Wednesday reports, with Ross Stores, Workday and Intuit scheduled to post results on Thursday. 

The week’s economic highlight comes on Wednesday, when the Federal Reserve releases minutes from the last meeting of the Federal Open Market Committee.

Conclusion

As the Dow reaches the historic 40,000 mark, the market’s focus shifts to upcoming inflation data and corporate earnings, particularly from AI leaders like Nvidia.

The overall sentiment remains optimistic, bolstered by expectations of favorable monetary policies and strong economic indicators.

Market conditions are dynamic, and investors should consider all available information and personal circumstances before making investment decisions.

Thanks for reading and support. You’re welcome.

@TigerStars @CaptainTiger @Tiger_SG @TigerPM