Stocks rose on Monday as the Dow Jones Industrial Average climbed 138.01 points, or 0.36%, to finish at 38,001.81, reaching a new record above the 38,000 level for the first time. The S&P 500 also added 0.22% to 4,850.43, reaching a fresh all-time high, while the Nasdaq Composite advanced 0.32% to 15,360.29.
Following the market movements, Macy’s rose more than 3% after rejecting a $5.8 billion proposal to take the retailer private, and SolarEdge jumped roughly 4% on the back of announcing a 16% workforce layoff. Conversely, Archer-Daniels-Midland plunged more than 24% after issuing weak earnings guidance and placing CFO Vikram Luthar on leave amid an investigation tied to accounting practices. B Riley Financial also slipped around 2.5% after Bloomberg reported that regulators are investigating deals with a client connected to securities fraud.
Monday’s gains come after the broad S&P 500 on Friday broke above its intraday and closing record highs set in January 2022, signaling a bull run that began in October 2022 after earlier stock plunges. According to Brian Price, head of investment management at Commonwealth Financial, the market seems to be resuming the trend that was clearly in place in the fourth quarter, driven by a ‘fear of missing out.’
Wall Street’s strength may depend on whether the U.S. central bank successfully engineers a soft landing, cooling the economy to lower inflation while avoiding a recession. Traders are now pricing in a roughly 40% chance of a Fed rate cut in March, according to CME Group’s FedWatch Tool, marking a steep decrease from almost 81% a week earlier. There’s a nearly 58% likelihood that the central bank will keep rates steady, up from around 19% one week prior.
Investors will be closely watching a slate of economic reports due out this week, including fourth quarter gross domestic product on Thursday and the Fed’s favorite inflation measure, December’s personal consumption expenditures price index on Friday. Both reports will help shape how Fed decisions are made in the near future.
