The Dow Jones Industrial Average has hit 40,000 for the first time ever on Thursday morning after a favorable inflation report.
The index — a collection 30 major companies including Apple and McDonald's — has gained 6 per cent this year. The S&P 500 and the Nasdaq have also hit record highs, outpacing the Dow.
The climb came after the Bureau of Labour Statistics reported that the Consumer Price Index climbed 3.4 per cent in April, which was below what analysts expected.
The Federal Reserve is still targeting an inflation rate of 2 per cent. If inflation has slowed — as some analysts believe the latest CPI numbers indicate — then the Fed may consider cutting key interest rates from the nearly 5.5 per cent that they've been stuck at for the last year.
The S&P 500 was up 0.2 per cent in Thursday morning trading. The Dow Jones Industrial Average showed 109 points higher, 0.3 percent, at 40,017, as of 10.45 am US EST, and the Nasdaq was up 0.2 per cent. On Wednesday, all three rallied and set all-time highs.
Walmart’s stock prices rose 6.4 per cent after reporting stronger profit for the latest quarter than analysts forecast. It also said its revenue for the year could exceed its previous forecasts.
Target said it was also rising, as are other retailers like Dollar General and Dollar Tree. All three added at least 2 percent.
If current trends continue, it could signal some coming relief for Americans trying to keep their heads above water as inflation eats into their buying power.
One report showed slightly more workers applied for unemployment benefits last week than economists expected, though the number remains low compared with history. Others said homebuilders broke ground on fewer projects last month than expected, manufacturing growth in the mid-Atlantic region was weaker than hoped and import prices rose more than forecast.
More workers applied for unemployment benefits last week than economists predicted, but that number is still lower than the same time period in previous years.
“Today’s numbers were in line with the overall theme of the week—nothing dramatic, but showing signs of a steady-to-cooling economy,” Chris Larkin, managing director, trading and investing, at E-Trade from Morgan Stanley, told the Associated Press.
