Dow Jones Index Makes New All-Time High
By Dale Gillham | Published 09 July 2019
So what happened in the US stock market last week? The Dow Jones Index broke above the previous weeks high on opening to make a new all-time high, dispelling signs of indecision to close the week 1.21 percent or 323 points higher than it closed the week before. No doubt the market was influenced by the announcement of higher than expected jobs numbers for June
The story was similar for the S&P 500, with last week’s rise being the fourth week in which both the Dow Jones Industrial Average and the S&P 500 continued to rise.
Looking at the top 100 stocks in the S&P 500, Starbucks was up nearly 5 percent for the week, followed by Alphabet up 4.6 percent in a sign that this stock may be about to rise strongly and break above its all-time high.
While job figures were above economists’ expectations, the current rise on the US stock market has put a question mark on whether the Fed would drop interest rates in the coming months.
There is only so much the Fed can do to stimulate the economy and any interest rate cut right now would only be a Hail Mary attempt to do so. In an already very low interest rate environment, any such move is, in my opinion, like trying to repeat the past in desperation that it might actually work this time.
Right now, there is a lot of uncertainty with the US and China trade war issues with North Korea and possible conflicts with Iran. Given this, it’s no wonder American consumers and businesses are uncertain as to what the future might hold and in these conditions.
Most people prefer the status quo rather than taking on additional risk. Let’s hope Mr Trump and the Federal Government sort these issues out quickly with China, so that things can get back on track.
Dale Gillham is Chief Analyst at Wealth Within and international bestselling author of How to Beat the Managed Funds by 20%. He is also author of the award winning book Accelerate Your Wealth—It’s Your Money, Your Choice.
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