All three major stock indexes finished at record highs on Wednesday, boosted by thin trading and the prospect of three central bank nominees who are open to more interest rate cuts.
The markets closed early ahead of the Independence Day holiday. They are closed Thursday.
The Dow Jones industrial average closed up 179 points, or 0.67%, at 26,966, passing its high of 26,828.39 reached on Oct. 3. The Standard & Poor’s index set another record on Wednesday, ending up almost 23 points, or 0.77%, at 2,995.82.
The tech-heavy Nasdaq increased 61 points, or 0.75%, to close at 8,170.23, surpassing the record of 8,164 set on May 3.
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“It took exactly nine months, but the Dow finally closed at a new all-time high,” said Ryan Detrick, Senior Market Strategist for LPL Financial. “A more dovish Fed and the realization that the economy is slowing, but not going into a recession, have sparked much of the amazing turnaround since the December weakness.”
On Tuesday, President Donald Trump tweeted that he planned to nominate Judy Shelton and Christopher Waller for the Federal Reserve Board. Both are considered candidates who would press for lower interest rates.
Similarly, European leaders this week nominated Christine Lagarde to lead the European Central Bank later this year. She is expected to continue her predecessor’s fiscal stimulus.
Economic data released on Wednesday also pointed to a slowing U.S. economy, providing possible support for lower rates soon. A measure of private hiring missed expectations, while reports on trade and the services sector also disappointed.
“What could be next?” Detrick said. “Earnings season is right around the corner and it is time for corporate America to justify stocks at these levels.”