Dow’s record close

The Dow Jones closed at a record high last night despite tapering from the Federal Reserve.

The Dow Jones is currently trading 16,572, slightly below last night's close of 16,580. It is a bullish sign to see the US equity benchmark only a touch lower after its record close. Last night, the Federal Reserve kept interest rates at ultra-low and reduced the bond buying scheme by $10 billion to $45 billion; both figures were in line with expectations.

A trimming of the stimulus package is seen as a positive sign. It means the US economy is moving towards standing on its own two feet, even though the economy only grew by 0.1% in the first-quarter of 2014.

Tomorrow is the first Friday of the month, which means we can expect the non-farm payroll data. The consensus is for an increase of 215,000 new jobs to be created and for unemployment to fall to 6.6%. As Brenda Kelly stated, there is bullish sentiment regarding tomorrow’s announcement at 1.30pm (London time). If the figures fail to impress traders we could drop back to 16,400. Alternatively, if they beat expectations we could break through the 16,600 level.

Wall Street chart

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.