Record Breaking Dow Takes us into the 4th of July
Written by Ryan Bouchey
Today, for the first time ever, the Dow Jones Industrials broke the 17,000 mark on the eve of the Fourth of July weekend. The strong performance is driven by a quality jobs number and great manufacturing data from earlier in the week. Although we as a firm prefer the S&P 500 as our U.S. equities benchmark over the Dow, this is still big news for the stock market.
Today’s jobs report showed 288,000 jobs being created in June which was better than expected. This also moved the unemployment rate from 6.3% to 6.1%. We’ll see how this number changes once the revisions are posted, but it’s a positive sign compared to the dreadful first quarter economic numbers reported over the past several months. On Tuesday, we were greeted with even more good news when the U.S. Manufacturing Purchasing Managers Index rose to 57.3. This was the highest reading since May 2010 and is a good indicator of the strength of the U.S. economy.
The key to this good news will be if the current wave of momentum carries over to earnings season next week. Second quarter earnings numbers will start being released and we will be watching it closely to see if companies fared better in the 2nd quarter than the 1st. As always, it’s important not to get too caught up in the day to day news but to be invested for the long term and stay disciplined in your investment approach. The first half of this year was a great example of how being diversified and not trying to time the markets can help your overall returns during volatile times.
Enjoy the long weekend and have a Happy Fourth of July!