- The Dow Jones gained over 200 points, setting a novel all-time high.
- AI offerings are back in action and chip stocks are rising again.
- U.S. retail sales rebounded in September, beating overall forecasts.
The Dow Jones Industrial Average (DJIA) hit a novel all-time high on Thursday, boosted by investors returning to gains in AI stocks and gaining more than 200 points on the day’s opening bids. U.S. retail sales easily outpaced the market, rebounding more than market analysts expected and pushing stocks even higher.
Retail sales in the US increased by 0.4% m/m in September, recovering from the August level of 0.1% and exceeding the median market forecast of 0.3%. Retail sales excluding automotive spending also positively surprised forecasts, growing 0.5% in September compared with the expected 0.1% and easily outperforming the 0.2% growth recorded in August.
The number of novel jobless claims in the US in the week ended October 11 also exceeded market expectations and amounted to 241,000. during the week. Investors expected the number of jobless claims to remain stable this week at 260,000. from last week.
Silicon producers and chip cutting companies are gaining ground on Thursday. On Thursday, Nvidia (NVDA) hit another all-time high, rising above 3%. Taiwan Semiconductor Manufacturing Company, a key supplier in the technology sphere, announced better-than-expected earnings for the third quarter and raised its revenue forecasts for the fourth quarter. The upbeat earnings announcement calmed market fears that the artificial intelligence boom may be fizzling out, even as large-scale predictive data modeling projects continue to struggle to find ways to generate revenue from their projects.
Dow Jones News
Even though almost half of the Dow Jones index was cautiously in the red on Thursday, significant gains in key stocks are lifting the quotations of all companies. Intel (INTC) rose 1.6% in tech gains, rising above $22.50 a share as the struggling chipmaker claws back losses from multi-year lows.
Travelers Companies (TRV) rose 8% on Thursday to above $262 per share after the insurer reported stronger-than-expected third-quarter earnings. Revenue rose on a quarterly basis when markets generally expected a slight decline. CEO Alan Schnitzer attributed the company’s “outstanding underwriting performance” to net growth in earned premiums and an overall reduction in underwriting payouts.
Dow Jones Price Forecast
The Dow continues to rally on the charts, hitting novel all-time highs above 43,250 and extending its 2024 bull run to almost 15%. Bullish momentum is once again outpacing long-term averages, with the 200-day exponential moving average (EMA) rising to 39,500 and struggling to catch up.
The price action has tilted heavily towards the overbought end, spelling trouble for traders looking for sleek sailing. While short-term investors will no doubt look for a return to the median price on the downside before re-entering the next level higher, there is no reason why investors who are already very long should exit now.
