DOW decisively to a new record high yesterday, reinforcing the view that the Santa rally is firmly in force after clearly this week’s FOMC risk. With momentum accelerating, the index is now on track to challenge the 50,000 psychological level before year-end, a milestone that reflects renewed confidence in the outlook for growth and monetary policy.
Markets have looked past persistent debate over AI valuations, focusing instead on the Fed’s less-hawkish-than-expected rate cut earlier this week. The shift has favored cyclical and traditional sectors. Russell 2000’s surge to a record close adds further confirmation. Smaller companies are typically more sensitive to changes in borrowing costs, and their leadership highlights expectations that easing financial conditions will filter through to the real economy.
Technically, near-term outlook for DOW remains bullish as long as 47,462.94 support holds. The current uptrend is targeting 78.6% projection of 28,660.94 to 45,071.29 from 36,611.78 at 49,510.32, with scope to stretch above 50,000 handle. Attention now turns to whether S&P 500 joins the breakout to confirm momentum, even as NASDAQ’s participation remains less certain.
