Dow Jones Industrial Average goes on a scorching run, climbs 650 points on Tuesday

• Dow Jones gains 1.5% in a single day as rate cut hopes surge.
• Easing US Retail Sales data reignited market bets of a September rate cut.
• Dow Jones sets a new record high for a second day in a row.

The Dow Jones Industrial Average (DJIA) surged to a second record-setting day in a row, climbing over 650 points to chalk in a fresh all-time peak above 40,850 as market sentiment buries the needle even further into hopes of a September rate cut from the Federal Reserve (Fed).

US Retail Sales slumped flat in June, printing at 0.0% in-line with forecasts and falling from the previous month’s revised 0.3% uptick, signaling that the US domestic economy is continuing to soften and prompting a broad-market rush into expectations of a September rate cut.

According to the CME’s FedWatch Tool, rate markets have a September rate trim fully priced in, with functionally 100% odds of at least a quarter-point rate cut when the Federal Open Market Committee (FOMC) meets on September. The FOMC’s upcoming rate call on July 31 is still broadly expected to be a hold as policymakers wait for a few more months of data to confirm inflation is easing to targets before pulling the trigger.

Dow Jones news

The Dow Jones soared over 600 points at its highest point on Tuesday as the major equity index makes its way toward 41,000.00 after crossing the 40,000.00 major handle for the first time back in May. 

Unitedhealth Group Inc. (UNH) soared 5.55% to $544.16 per share on Tuesday after it reported better-than-expected earnings in Q2, helping to send the Dow Jones further into the stratosphere. Over two-thirds of the Dow Jones in in the green for the day, though tech stocks and AI-adjacents suffered small losses as the market pivots into rate cut exposure. 

Merck & Co Inc. (MRK) fell -1.5% to $126.20 per share, followed closely by Microsoft Corp. (MSFT) and Intel Corp. (INTC), falling -1.43% and -1.2%, respectively.

Dow Jones technical outlook

Buyers ran a clinic on short interest on Tuesday, sending the Dow Jones into a record intraday high for the second day in a row. Technical resistance has evaporated on the top end as the major equity index is on pace for one of its best single-day performances of 2024.

The Dow Jones has climbed over 4% and counting over the past five trading days and the index is set to challenge the 41,000.00 technical level sooner rather than later.

Dow Jones five minute chart

Dow Jones daily chart