The DIJA rally is going strong and withstanding pressure from sentiments surrounding the Fed’s increase in interest rates.
The Dow Jones Industrial Average (DIJA) has completed a 13-day rally, the longest streak in more than 36 years. This rally continued despite a hike in interest rates and a generally shaky economy.
The DIJA climbed 0.23%, adding 82.05 points, and closed at 35,520.12. After 13 days, the index’s streak is the best since 1987. Another consecutive day of an upswing would firmly confirm another record – the longest streak since June 1897, only a year after the DIJA launched in May 1896. While the Dow closed higher on the day, other indexes fell. The Nasdaq Composite closed at 14,127.28 after falling 0.12%, while the S&P 500 lost 0.02 to close at 4,566.75.
The Dow Jones rally also agrees with a forecast for the index from last year. CoinSpeaker’s Advent Calendar last December reported monthly predictions for the DIJA, putting the index at 33,892 this month. As of this writing, the Dow’s previous close is already 4.8% higher than the forecast. The forecast however predicts major headwinds for this year, indicating that the DIJA will close the year at less than 32,000.
Fed Interest Rate Hike on DIJA Rally
It might be early to conclude on the relationship between the recent hike in interest rates and the DIJA’s swing. At the FOMC’s meeting yesterday, the Fed officially increased interest rates to its highest level in 22 years. Fed Chair Jerome Powell considers these hikes necessary to combat rising inflation.
Powell also added that the Fed may increase the rates again after its next meeting in September if it considers a hike necessary. However, this is not a given, as Powell added that the agency will make careful assessments and may also decide to pause rate hikes.
As the Fed battles inflation in the economy, the market is still considering individual earnings reports recently released. Google parent Alphabet published its Q2 earnings report showing that the tech giant scaled expectations for revenue and profit. The company’s revenue climbed 7% to $74.6 billion from the $69.7 billion recorded a year earlier. Alphabet pulled its weight despite a recorded drop in digital advertising.
Microsoft Corporation (NASDAQ: MSFT) also published its earnings results for fiscal Q4 2023. The company recorded $56.2 billion in total revenue, an 8% increase from fiscal Q4 2022. Microsoft’s revenue was also higher than the $55.47 billion expected, according to analysts polled by Refinitiv. In addition to the increase in revenue, Microsoft’s report showed the company’s earnings per share came in at $2.69, also higher than analysts’ expectation of $2.55. Furthermore, ‘the company’s operating income increased by 18% to $24.3 billion, with net income climbing 20% from the same quarter a year ago to $20.1 billion. Much of Microsoft’s climb came from its Cloud business, which rose nearly 21% compared to 2022’s fiscal Q4.
Microsoft also reported that revenue from LinkedIn increased by 5%, while revenue from Intelligent Cloud increased by 15% to $24 billion.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
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