Key Takeaways
- The Dow Jones Industrial Average topped the 40,000-point level at Friday's close for the first time in its history.
- Originating way back in 1896 and often considered a barometer of the overall U.S. economy, the index tracks the performance of 30 blue-chip companies.
- The last major milestone for the Dow occurred in November 2020, when the index closed above 30,000.
The Dow Jones Industrial Average closed above 40,000 points on Friday for the first time in its 128-year history of tracking some of the largest companies trading on the U.S. stock markets.
The index ended the trading day at 40,003.59. The last time the Dow (DJI) closed above a major milestone was on Nov. 24, 2020, when the blue-chip index first pierced 30,000. Since then, it took the index 874 trading days to reach its latest round-number landmark, according to a Wall Street Journal analysis.
When the widely followed Dow reaches a major round number like 40,000, it often garners significant attention from investors and the financial media. Although such milestones do nothing to alter the fundamentals or drivers of the market, they can have a psychological impact that influences investor attitudes and behaviors.
Dow Rally Rode AI Wave Despite Recession Fears
The Dow's climb to the 40,000-point level coincided with what could have been a challenging environment for stock market gains. From March 2022 through July 2023, the Federal Reserve aggressively raised interest rates in a campaign against soaring inflation. Fed rate hikes translate to higher borrowing costs, making it more difficult for companies to finance their growth.
However, concerns that the higher interest rate environment could sink the U.S. economy into a recession never materialized, the jobs market remained strong, and inflation gradually showed signs of cooling off—helping the Dow defy the odds to continue its march higher.
In addition to the surprising economic resilience, optimism around artificial intelligence (AI) has helped underpin the stock market rally. Expectations that AI could boost productivity and provide an array of profitable opportunities have benefitted many companies—especially the Magnificent Seven group of stocks, which includes Dow components Amazon (AMZN), Apple (AAPL), and Microsoft (MSFT).
Previous Milestones for the Dow
The Dow's trip past 30,000 signaled a dramatic recovery in November 2020. In March, the index had sat at 19,000 amid COVID-19-related restrictions. The surge coincided with positive vaccine news and the removal of uncertainty following that year's election.
The Dow first traded above 20,000 on Jan. 25, 2017. The index reached that level thanks to sharp gains following the election of President Donald Trump the previous November, as investors were optimistic that plans for tax cuts, deregulation, and infrastructure spending would boost corporate profits.
Investors may have been partying like it was 1999 when the Dow first crossed the 10,000-point mark on March 29 of that year. It's worth noting this was around the height of the dot-com bubble, which would burst around a year later and send markets tumbling.
Tracing the Dow back to the 1,000-point level requires a trip back to Nov. 14, 1972. This achievement followed shortly after the election of President Richard Nixon, and cheers reportedly broke out on the floor of the New York Stock Exchange to mark the occasion.
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FAQs
WHAT'S ALL THE HUBBUB NOW? The Dow crossed its latest 10,000 point threshold briefly on Thursday and closed above 40,000 Friday — at 40,003.59 to be exact. It took about three and a half years to make the leap from 30,000 points, which it first crossed in November 2020.
When did Dow close over $40,000? ›
The Dow was up 300 points to 40,056.32, on pace to finally top its record close of 40,003.59 from May 17. After crossing the 40,000 threshold, the Dow struggled in the ensuing weeks. But a broadening of the market's rally has helped the blue-chip index shine in recent sessions.
What is the highest the Dow has ever closed at? ›
Did the Dow Jones trade above 40000 for the first time but fails to achieve milestone? ›
The Dow Jones Industrial Average briefly traded above 40,000 for the first time ever Thursday but ended the day shy of a milestone that investors said could help further boost bullish spirits on Wall Street.
What does it mean when the Dow hits 40,000 today? ›
Passing the 40,000 barrier makes for a nice headline, but market experts do not take much else from the Dow move. Forty thousand “is a great milestone, but [at the] end of the day there isn't much difference between 39,999 and 40k,” said Ryan Detrick, chief market strategist at Carson Group.
Will Dow hit $40,000 in 2024? ›
Traders on the floor of the New York Stock Exchange in New York City on May 16, 2024, when the Dow hit 40,000 points for the first time ever. The Dow Jones Industrial Average surpassed 40,000 points on Thursday for the first time ever, signaling a strong endorsem*nt of the health of the U.S. economy.
Has the Dow Jones ever reached 37000? ›
Deciphering the Dow's Recent Ascent
Analyzing the data reveals that the Dow reached the 37,000-point mark on December 13, marking the first thousand-point milestone in 771 days.
Has the Dow ever dropped 1000 points in a day? ›
Dow plunges more than 1,000 points amid fears of U.S. economic slowdown. Stocks in the U.S. plunged for a third consecutive trading day, with the Dow Jones Industrial Average tumbling more than 1,000 points amid growing fears of an economic downturn sparked by a slowdown in hiring and consumer spending.
How many times has Dow hit 40,000? ›
The Dow Jones Industrial Average closed above the 40,000 mark Friday for the first time in its 139-year history. The blue-chip index initially crossed the key threshold early Thursday but ended that day lower.
What is the biggest Dow drop in history? ›
The statistic shows the worst days of the Dow Jones Industrial Average index from 1897 to 2023. The worst day in the history of the index was October 19 1987, when the index value decreased by 22.61 percent.
Largest daily percentage losses
| Rank | Date | Change |
|---|
| % |
|---|
| 1 | 1987-10-19 | −22.61 |
| 2 | 2020-03-16 | −12.93 |
| 3 | 1929-10-28 | −12.82 |
17 more rowsThe statistic shows the best years of the Dow Jones Industrial Average index from 1897 to 2023. The best year in the history of the index was 1915, when the index value increased by 81.66 percent to close at 99.15 points compared to 54.58 in the previous year.
Who predicted Dow 40,000? ›
Elias, who is 79 years old and lives in Williamsville, N.Y., predicted in his 1999 book, “Dow 40,000: Strategies for Profiting from the Greatest Bull Market in History,” that the index would cross the milestone by 2016.
Will the Dow ever hit $50,000? ›
On April 12, 1994, the Dow Jones Industrial Average closed at 3,681.69. Over the trailing-30-year period, this widely followed index has increased at an annualized rate of 8.09%! If this superior rate of gains were to persist, the Dow could reach 50,000 before the calendar changes to 2028.
How high will Dow go in 2024? ›
Dow Jones Predictions For Next Months And Years. Dow Jones forecast for September 2024. The forecast for early September 41563. Maximum value 44011, minimum value 37132.
Has the Dow ever closed at $40,000? ›
The Dow Jones Industrial Average topped the 40,000-point level at Friday's close for the first time in its history. Originating way back in 1896 and often considered a barometer of the overall U.S. economy, the index tracks the performance of 30 blue-chip companies.
When was Dow at $10,000? ›
It was 25 years ago today, March 29th, 1999, that the Dow Jones Industrial Average (DJIA) topped the 10,000 mark for the first time.
When was the last time the stock market fell below 30000? ›
On March 11, 2020, the Dow Jones Industrial Average (DJIA) entered a bear market for the first time in 11 years amid the economic impacts of the COVID-19 pandemic. The Dow Jones Average fell from nearly 30,000 to under 19,000.
How much did the Dow close on April 30 2024? ›
The S&P 500 fell 80.48 points, or 1.6%, to 5,035.69. The Dow Jones Industrial Average fell 570.17 points, or 1.5%, to 37,815.92. The Nasdaq composite fell 325.26 points, or 2%, to 15,657.82. The Russell 2000 index of smaller companies fell 42.12 points, or 2.1%, to 1,973.91.
