The Dow Just Busted out of its Longest Stint in Correction Territory in Nearly 60 Years
S&P 500 has already exited its correction phase
The Dow Jones Industrial Average on Monday catapulted out correction territory for the first time in more than six months, ending its longest period in that phase since a 223-session run in 1961, according to Dow Jones Market Data.
Monday’s broad-market rally was underpinned by signs of progress toward resolving nettlesome trade disputes that have whipsawed markets. Specifically, President Donald Trump said the U.S. has reached an agreement with Mexico to enter into a new trade deal, calling it the U.S.-Mexico trade pact.
Before Monday, the blue-chip benchmark had failed to trade 10% above the closing low of 23,533.20 hit on March 23, but could do so with a close at 25,886.52 or higher. It entered correction territory on Feb. 8, when it fell 10% from a record high set on Jan. 26, as did the S&P 500 index SPX Technicians say an asset exits correction territory when it rises 10% from its correction low, though some purists argue that an asset must set a new high before it can be said to be out of correction.
The 122-year-old Dow DJIA closed up 1% at 26,049, also retaking the 26,000 level for the first time since Feb. 2. The S&P 500 previously exited correction phase, and went on to ring up its first record close since Jan. 26 on in Friday. Meanwhile, the Nasdaq Composite Index COMP narrowly avoided its own correction and is set to close at an all-time high Monday.
All three benchmarks closed in positive territory on Monday, with the S&P 500 and Nasdaq adding to their record climbs.