Dow Jones Industrial Average climbs into another record high

• The Dow Jones broke above 42,000 to set a third straight all-time high on Thursday.
• Equities are firmly bullish after the Fed's long-awaited rate cut this week.
• The Fed's jumbo 50 bps on Wednesday has paved the way for further cuts this year.

The Dow Jones Industrial Average (DJIA) pierced the 42,000 psychological level on Thursday as equities drove higher in a broad-market bull run after the Federal Reserve (Fed) finally delivered its first rate cut in over four years. Equities have gone full-tilt into a risk-on stance, and the Dow Jones is on pace to close up nearly 600 points in record territory.

On the data side, US Initial Jobless Claims eased back to 219K for the week ended September 13, down from the previous week's revised 231K and under the median market forecast of 230K. The Philadelphia Fed Manufacturing Survey for September also printed well above expectations, with the spread index of manufacturing conditions improving to 1.7 from the previous seven-month low of -7.0 and handily beating the expected print of -1.0.

Fed Chair Jerome Powell convinced markets that the Fed's outsized jumbo cut of 50 bps this week wasn't a snap response to deteriorating economic conditions but rather an attempt to get ahead of the curve and bolster the US labor market. Powell successfully floated a rebranding of an entire half-percentage-point cut as a "recalibration," and investors rewarded the Fed's latest narrative pivot by plowing cash into equities across the board.

Dow Jones news

Despite some securities stuck stubbornly in the red, most of the Dow Jones board is deep in the green on Thursday. Salesforce (CRM) and Caterpillar (CAT) have climbed over 5% from the morning's open, tapping $266 and $373 per share, respectively. Salesforce is on the rise despite an announcement that Disney (DIS) would be ceasing their use of Salesforce-owned Slack as a company communication product after a security exploit allowed a hacking entity to capture and leak a terabyte of company information.

Dow Jones price forecast

With Dow Jones climbing around 600 points at its highest on Thursday, the major equity index is on pace to capture yet another record close as price action digs in north of 42,000. The Dow Jones' stellar 2024 performance is continuing unabated, with the stock board set to close in the green for a fifth straight month.

Buyer exhaustion continues to threaten intraday positions built up from the midweek pullback into 41,500. However, any real threat would first require enough short pressure to get baked into the chart, a difficult proposition with current prices facing no technical resistance and the Dow Jones trading a blistering 8% above the long-term 200-day Exponential Moving Average (EMA) at 38,656.

Dow Jones daily chart