- The Dow Jones surged to a new peak following the latest PCE inflation report.
- Headline PCE inflation in August moved closer to the Fed's target.
- Next week: PMI activity data and the NFP labor report are on the agenda.
The Dow Jones Industrial Average (DJIA) surged to another record high on Friday, fueled by a cooler-than-expected reading from the US Personal Consumption Expenditure (PCE) Price Index for August. Improved sentiment indicators for September also contributed to the rally, while market focus shifts to next week’s Nonfarm Payrolls (NFP) report.
The PCE price index edged up by just 0.1% in August, marking an annual PCE inflation rate of 2.2%—its lowest since March 2021. Headline inflation continues to drift toward the Federal Reserve's 2% target, though the core PCE figure, which excludes food and energy, rose to 2.7% year-over-year from 2.6%.
Consumer sentiment also improved, with the University of Michigan's (UoM) Consumer Sentiment Index climbing to 70.1 in September, exceeding expectations of 69.3 and last month’s reading of 69.0. Meanwhile, the UoM’s 5-year Consumer Inflation Expectations survey held steady at 3.1%, signaling persistent inflation concerns among consumers.
With this week’s economic data in the rearview, attention now turns to the upcoming NFP labor report. Investors will be looking for continued strength in the US labor market to alleviate recession fears. Additionally, Purchasing Managers Index (PMI) business activity data will be released early next week.
Dow Jones news
The Dow Jones remained bullish on Friday, reaching a fresh record as the majority of the index’s stocks ended the day in positive territory. Only five Dow constituents finished lower, with Amazon (AMZN) falling 1.5% to $188 per share. Chevron (CVX) led the gains, climbing 2.35% to exceed $145 per share.
Dow Jones price forecast
The Dow Jones hit a new all-time high of 42,636 before pulling back to close just under 42,500. While the index continues to set record highs, bullish momentum has struggled to sustain a firm upward trajectory. Bears are lying in wait, eyeing a potential pullback toward the 50-day Exponential Moving Average (EMA) at 40,930.
Dow Jones daily chart
