For six straight weeks, Dow Jones Industrial Average made profits and got a never-before-seen 20,000 level as it closed on Friday. Many have predicted that the candidates chosen by president-elect Donald trump would be friendly to Wall Street, and this has also propelled the Dow to get to a record level 16 times. For instance, Steve Munchin who was formerly an executive at Goldman Sachs was nominated as Treasury Secretary and Rex Tillerson as Secretary of state is a CEO of ExxonMobil.
Within the week, the blue-chip index got new records and it traded around those levels in the back half as the post-election bounce continued.
The Dow closed with a weekly gain of about 0.5%, while S&P 500 closed with 0.1% lower, and Nasdaq closed with 0.03%. On Tuesday, each index scored new records.
On Wednesday the Market declined shortly, however, it rebounded on Thursday after traders familiarized with the increase in the Federal Reserve’s rate outlook.
The Federal Government increased its prediction on Wednesday which showed that there would likely be a three rates hike next year, two steps up from what was forecast earlier, after its two days meeting. The Federal Government also predicted that 2018 and 2019 hikes would be kept at three.
The central bank also chose to increase interest rates by 25 basis points after a unanimous decision. This means that Fed funds rate would be at about 0.5% to 0.75%. This increase marks the second time in about a decade. The December hike didn’t come as a surprise to marketers as it was earlier predicted to happen.