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The Dow closes above 38,000 for the first time, setting a record high

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The S&P 500 also reached a record high on Monday.

The Dow Jones Industrial Average closed above 38,000 points for the first time Monday, setting a record high and capping a steady rise extending into the past week.

The S&P 500 also reached a record high, closing at about 4,850 points. The tech-heavy Nasdaq rose to 15,360 by the end of trading on Monday.

Major stock indices started the year slowly, but began to rise in the middle of last week.

The latest rally follows a stellar performance for markets in 2023, largely driven by optimism about the prospects of a “soft landing,” where inflation falls to normal levels while the economy avoids a recession.

Investors' enthusiasm about artificial intelligence has also helped boost returns.

The market rally in recent days may be due in part to some investors' expectations of a Federal Reserve interest rate cut in March.

Interest rate cuts would reduce borrowing costs for consumers and businesses, which could trigger a wave of economic activity through increased household spending and business investment.

But the Fed risks a rebound in inflation if it cuts interest rates too quickly, because stronger consumer demand could lead to accelerated price increases.

Federal Reserve Governor Christopher Waller He said Early last week, the central bank expected to cut interest rates this year, but it would not “rush” to make a decision soon. These statements helped lead to a rise in Treasury bond yields and a decline in major stock indices.

But since then, the stock market has risen.

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The market's rise coincided with a consumer opinion survey issued by the Foundation University of Michigan Confidence rose 13% in January, reaching its highest level since July 2021, Friday showed.

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