Dow Jones Industrial Average gains ground on Monday, taps record highs

• The Dow Jones rose on Monday as equities resumed their upward momentum.
• The Fed's rate cut last week bolstered general market sentiment, but yields remain elevated.
• Fed policy statements are beginning to diverge wildly as the next rate-cutting cycle begins.

The Dow Jones Industrial Average (DJIA) rose on Monday, testing fresh all-time highs above 46,400. Despite some early session volatility, the Dow is following the rest of the US market higher to kick off the new trading week, with all major indexes showing green across the board.

After closing in the green for two straight weeks, the Dow Jones is firmly on its way to a third bullish weekly candle, pushing bids above last week's all-time highs to chalk in a fresh peak on Monday. The Dow is up around 2% in September alone, a month that has historically seen ill-tempered equity market performance.

Fed's internal divergence on rate forecast begins to widen

A flurry of Federal Reserve (Fed) policymaker statements greeted markets on Monday, and the narrative thread surrounding policy rate targets is beginning to diverge wildly across the voting body. Donald Trump's hand-picked Board of Governors member, Stephen Miran, is ramping up his rate-cutting rhetoric, declaring on Monday that the fed funds rate is 200 basis points too high, while also asserting that achieving net zero immigration will both bolster the labor market and tamp down inflation, a policy stance that does not appear to be shared by any of his fellow Fed board members.

A smattering of economic data will greet markets throughout the week. S&P Global Purchasing Managers Index (PMI) survey results for September are due on Tuesday and are expected to show a general decline in both the manufacturing and services segments. US Gross Domestic Product (GDP) growth is slated for Wednesday, and median market forecasts expect annualized Q2 growth to hold steady at 3.3%.

This week's key data release is set for Friday, when the latest Personal Consumption Expenditures Price Index (PCE) inflation from August will drop on markets. Core PCE inflation is expected to tick down to 0.2% MoM from 0.3%, while the yearly figure is forecast to hold steady at 2.9%, well above the Fed's 2.0% target.

Dow Jones daily chart