On Monday, U.S. stocks ended the day on a strong note, with two of the three major indices reaching new record highs due to robust buying across various sectors.
Optimism surrounding potential interest rate cuts by the Federal Reserve and increasing chances of former President Donald Trump winning the upcoming presidential election positively influenced the mood on Wall Street.
The Dow Jones Industrial Average gained 210.82 points, or 0.53%, to close at 40,211.72 after achieving a new high of 40,351.10. The S&P 500, which touched a record high of 5,666.94, ended at 5,631.22, up by 15.87 points or 0.28%. The Nasdaq closed at 18,472.57, with a rise of 74.12 points or 0.4% after hitting a peak of 18,641.53.
Caterpillar saw an increase of over 3%, while Goldman Sachs rose approximately 2.6% following strong second-quarter results. JP Morgan Chase and American Express gained 2.5% and 2.25%, respectively. Other significant gains were recorded by Apple Inc., Visa, Chevron, Travelers Companies, Walmart, and UnitedHealth Group.
Among high performers, Netflix, Adobe Inc., Costco Wholesale Corp., Qualcomm, Tesla, Automatic Data Processing, and Marriott International recorded substantial gains. Conversely, Nike fell nearly 3%, and Boeing, Verizon Communications, 3M Co., Procter & Gamble, McDonald's Corp., and Amazon declined between 0.9% and 2%.
Shares of Trump Media & Technology surged by nearly 32% amid high trading volumes, following former President Trump's narrow escape from an assassination attempt in Pennsylvania on Saturday.
In economic news, the Federal Reserve Bank of New York released a report indicating that regional manufacturing activity contracted at a slightly faster rate in July. The general business conditions index fell to -6.6 in July from -6.0 in June, with a negative reading signifying contraction. Economists had expected the index to remain unchanged.
Federal Reserve Chair Jerome Powell, speaking at the Economic Club of Washington D.C., stated that the central bank would not wait for inflation to reach 2% before cutting interest rates. Powell explained that central bank policy operates with "long and variable lags," implying that waiting for the target could result in inflation dropping below the 2% mark due to ongoing effects of existing tightness.
In international markets, Asian stocks had mixed results on Monday, influenced by disappointing Chinese GDP data and a stronger dollar driven by speculation of a Trump victory following the assassination attempt. Major European markets closed lower, impacted by unpromising economic data from China and lackluster corporate earnings updates.
