By John Towfighi, CNN
New York (CNN) — The Dow just hit 50,000 points for the first time ever.
The blue-chip index on Friday surged 1,097 points, or 2.24%, and climbed above 50,000 points during trading. It’s the first time the 129-year-old index has crossed the historic 50,000-point milestone.
The Dow’s ascent is emblematic of the stock market’s persistent rise despite recent tumultuous geopolitical events.
Stocks in the United States — and across the globe — have climbed higher this year despite uncertainty about turmoil in Iran, tensions between Washington and Brussels over Greenland and the US’ capture of Nicholas Maduro.
Stock market investors are also assessing the health of the artificial intelligence boom and digesting President Donald Trump’s pick of Kevin Warsh to chair the Federal Reserve.
Wall Street rallied sharply Friday, rebounding after a three-day rout in technology and software stocks. The broader S&P 500 on Friday rose 1.7%. The tech-heavy Nasdaq Composite rose 1.9%.
Rally broadens out
The US stock market is in the fourth year of a bull market.
The Dow has pushed higher as the rally has broadened out, with investors scooping up more than just high-flying tech stocks. The blue-chip index is outpacing the Nasdaq and the S&P 500 this year as investors rotate into sectors like industrials and financials.
The Dow is more focused on sectors like financials and industrials, and less exposed to the tech sector, which accounts for a larger share of the S&P 500 and Nasdaq Composite’s market value.
Goldman Sachs (GS) and Caterpillar (CAT), the two stocks with the most influence over the price-weighted Dow, rose 4.2% and 6.4% Friday, respectively. Caterpillar hit a record high.
“The positives of the Dow getting to that new milestone, is it’s showing we’re seeing a broadening in the market,” said Matt Dmytryszyn, chief investment officer at Composition Wealth. “It’s not just tech stocks and AI. We’re seeing more broader financial and industrial and healthcare companies starting to become more broadly bought and recognized in the market.”
The Dow hitting 50,000 for the first time reflects Wall Street’s optimism about the US economy and is just another record now broken on the market’s multi-year bull run. Still, “fear” was the sentiment driving markets on Friday, according to CNN’s Fear and Greed Index.
“Fundamentals remain solidly in place, meaning improving earnings growth and resilient consumer spending,” said Rob Haworth, senior investment strategy director at US Bank Asset Management.
On paper, the economy is doing fine. Wall Street is hopeful for interest rate cuts from the Fed later this year.
Underneath the hood, however, the picture is less rosy. Consumer spending is being driven by wealthier households who tend have money in stocks and have seen their investments rise in value, while people who rely on paychecks for their income are feeling strained by a lack of affordability.
Meanwhile, some on Wall Street continue to warn of complacency in financial markets amid affronts to the Fed’s independence, persistent nerves about a bubble and increasingly fraught geopolitics.
“The US economy has remained resilient,”