Nasdaq and Dow Jones with new historical growth

The US markets finished the Monday session with growth and Nasdaq briefly touched the psychologically important threshold of 5,000 points, while the Dow Jones reached a new record for the middle of the day. The investors enjoyed good economic data from the US and the reduction of interest rates in China. At the end of the first week session US indexes finished with green light – Nasdaq ended the session on 5,004.5 points (+0.83%), Dow Jones Industrial Average ended the session at 18,257.55 points (+0.69%) and S&P 500 finished at 2,116.09 points (+0.55%).

Nasdaq Composite last reached 5,000 points at the top of the technology bubble in March 2000. The index crashed in the coming months and reached 1,108.49 points in October 2002. Nasdaq have closed only twice over 5,000 points – on 9th March 2000 and 20th March 2000. According to the analysts the things now are different as the companies, reaching these levels are doing it with strong revenues, stable incomes and assets. To put things in perspective, the number 5000 is the nominal level. To reach the peak recorded to accumulated inflation, Nasdaq will have to reach 6,900 points, with 38% over 5,000.

Dow Jones Industrial Average also rose more than 100 points and reached a new record of 18,260.31 points after quite encouraging US economic data. Cisco shares led gains in blue chips. The US manufacturing sector reported the best profits since October showed PMI of Markit. The index rose to 55.1 points compared to 53.9 points in January. The personal income rose 0.3%, while spending decreased by 0.2% in January.

The Central Bank of China cut its main interest rate by 25 basis points to 5.35% on Saturday. Deteriorating economic conditions forced the bank to reduce the time between decisions on policy. This strongly reflected the world trade markets and mostly the Wall Street ones, as Chinese and US economy and highly dependent.