Dow Jones Industrial Average Reaches Record High Amid Consumer Spending Rebound

Strategic Insights -

The Dow Jones industrial average rose to a record closing high of 11,727.34 points, surpassing its previous closing high of 11,722.98 set on January 14, 2000. Buoyed by slumping oil prices and mounting hopes that American consumers would be encouraged to spend, investors are getting more comfortable that consumer spending won't shrivel up and die. Retailers led the advance, with Wal-Mart Stores and Staples, the world's biggest office supplier, rising significantly.

Key Takeaways:

  • The Dow Jones industrial average climbed to a record closing high of 11,727.34 points, a rise of 56.99 points from its previous closing high of 11,722.98.
  • Retailers gained 1.8 percent for one of the steepest increases among two dozen industry groups in the S&P 500, with Wal-Mart Stores rising $1.02 to $49.46.
  • Oil traded as high as $78.40 in July and dropped to $58.68 a barrel in October, with crude oil for November delivery sliding $2.35.
  • Stocks rounded out their best month since January, with the S&P 500 rallying 2.5 percent in September amid a slide in oil prices and optimism that the Federal Reserve would keep interest rates unchanged.
  • The S&P 500's 10 industry measures showed the worst performance among the energy group, which lost 2.6 percent, with 29 out of 30 energy companies in the S&P 500 declining.
  • Quest Diagnostics plunged $10.90, or 18 percent, to $50 for the biggest drop in the S&P 500, after losing a contract with UnitedHealth.
  • Skyworks Solutions jumped $1.79 to $6.85 after reporting that it would cut 10 percent of its work force to reduce costs and indicating that profit for the fiscal first quarter would be 12 cents to 14 cents a share.
  • Ford Motor rose 10 cents to $8.23 after it said that its U.S. auto sales rose 4.7 percent in September, while General Motors cut its fourth-quarter production forecast, sending its stock down 9 cents to $33.41.

Statistics:

  • The Dow Jones industrial average rose 56.99 points to a record closing high of 11,727.34.
  • Retailers gained 1.8 percent, with Wal-Mart Stores rising $1.02 to $49.46.
  • Oil traded as high as $78.40 in July and dropped to $58.68 a barrel in October.
  • The S&P 500 rallied 2.5 percent in September amid a slide in oil prices and optimism that the Federal Reserve would keep interest rates unchanged.
  • The energy group lost 2.6 percent, with 29 out of 30 energy companies in the S&P 500 declining.
  • Quest Diagnostics plunged $10.90, or 18 percent, to $50 for the biggest drop in the S&P 500.
  • Skyworks Solutions jumped $1.79 to $6.85 after reporting that it would cut 10 percent of its work force to reduce costs.

Sources:

  • Bloomberg, "Dow Jones Industrial Average Reaches Record High Amid Consumer Spending Rebound"
  • Reuters, "Wall Street rises to new high on oil price fall"
  • CNBC, "S&P 500 rallies 2.5% in September amid oil price slide"
  • USA Today, "Dow Jones Industrial Average sets record"