The Dow Jones Industrial Average closed above 42,000 for the first time after a 500-point rally. The S&P 500 also notched a new record, rising 1.7% to close above 5,700. The Nasdaq gained 2.5%.
All three major indexes are on pace for winning weeks: The Dow and the S&P are each up about 1.5% since Monday, and the Nasdaq is up almost 1.9%. Nike will see a significant leadership change next month as CEO John Donahoe steps down to replace Elliott Hill. Donahoe has led Nike since January 2020 and oversaw a broad restructuring effort to shift the company’s strategy towards direct-to-consumer sales.
He will retire on Oct. 13 and remain an advisor through the end of January. Hill was most recently president of consumer and marketplace at Nike before retiring in 2020.
According to the National Association of Realtors, home sales were disappointing again in August, falling 2.5% from July levels and 4.2% from a year ago. This drop fell slightly below analysts’ expectations.
Dow hits milestone after rally
However, lower mortgage rates and increasing inventory could potentially boost sales in the coming months. “The recent development of lower mortgage rates coupled with increasing inventory is a powerful combination that will provide the environment for sales to move higher in future months,” said Lawrence Yun, NAR’s chief economist. The United Auto Workers (UAW) is gearing up for potential strikes one year after historic national contract negotiations.
This time, the focus is on local contracts, with key issues including job security, wage parity for Skilled Trades, and work rules. A strike deadline has been set for 11:59 p.m. on Sept. 25 at a Ford plant, and strike authorization votes are planned at certain U.S. Stellantis plants.
Federal Reserve Chair Jerome Powell emphasized “recalibration” during this week’s news conference after the central bank’s first rate cut in four years. Powell used the term, or variations of it, multiple times to push the narrative that the easing cycle is not about responding to a recession but about extending economic expansion. “It really allows him to push this narrative that this easing cycle is not about us being in recession; it is about extending the economic expansion,” said Tom Porcelli, chief U.S. economist at PGIM Fixed Income.
“I think it’s a really powerful idea. It’s something we had been hoping that he would do.”
