Dow jumps 500 points to new 2023 high Thursday, capping 8% November rally: Live updates

The Dow Jones Industrial Average rallied Thursday to a new high for the year, as more cooling inflation data and strong Salesforce earnings capped the benchmark’s best month since October 2022.

The 30-stock Dow gained 520 points, or 1.47%, to close at 35,950.89, surpassing its previous high for the year in August. The S&P 500 added 0.4% to 4,567.80. However, the Nasdaq Composite was about 0.2% lower at 14,226.22 as investors took some profits in Big Tech stocks that have led the November comeback.

The Dow closed out November with an 8.9% gain, breaking its three-month losing streak. The S&P 500 rose 8.9% in November, while the Nasdaq advanced 10.7%. Both averages had their best monthly performance since July 2022, and were trading about 1% away from their respective 2023 highs.

“A lot of what we’ve seen in November is just a realization that the economy is still doing well, that consumers are resilient and the Fed is on hold, more than anything else,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance. “Assuming those conditions stay between now and the end of the year — which is our our most likely scenario — we think the market will continue to drift higher.”

“For 2022, we spent so much time thinking about what could go wrong, and we really didn’t spend any time thinking about what could go right. 2023 is a story of a lot of things going right, ” Zaccarelli added.

Leading the Dow higher on Thursday was cloud software company Salesforce, which popped 9.4% on the back of better-than-expected earnings and revenue for the fiscal third quarter. Salesforce’s cloud data business, which saw its revenue increase by 22% from the previous year, and its artificial intelligence product Einstein GPT were behind the positive report. Health-care companies UnitedHealth Group, Johnson & Johnson, Merck and Amgen also led the index higher.

Data released early Thursday showed that the personal consumption expenditures price index — the Federal Reserve’s favorite inflation gauge — rose 3.5% on a year-over-year basis, a slowing from a 3.7% annual gain in prior month.

These numbers were the latest in a string of positive inflation data seen in November that caused traders to conclude the Federal Reserve is likely done raising rates and could even begin lowering them in 2024.

“What’s driving the market, ultimately, is that shift in monetary policy,” said Sonu Varghese, global macro strategist at Carson Group. “Lower volatility could also push more money into markets as people regrow their portfolios and increase exposure to equities. We think new highs are definitely possible.”

The 10-year Treasury yield, which had spooked investors by rising above 5% last month, collapsed this month as the cooling inflation data rolled out, helping to boost sentiment for equities. The 10-year yield ticked a higher to 4.34% Thursday.

Technology shares were far and away the big winners in November, but investors took some of those bets off the table as the month came to a close. Nvidia shed 2.9% on Thursday, but still ended the month up 14.7%. Tesla shares were off by 1.7% Thursday following a 19.5% comeback in November. Alphabet and Meta lost 1.8% and 1.5% during the day, respectively.