U.S. stocks soared on consumer confidence and an improving outlook, with the blue-chip Dow Jones Industrial Average closing above 50,000 for the first time.
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On February 6, US stocks soared in a surprising turnaround, with the blue-chip Dow Jones Industrial Average rising more than 1,200 points and closing above the $50,000 mark for the first time in history.
“Reaching the Dow to $50,000 is more of an affirmation than a celebration,” Gina Bolvin, president of Bolvin Wealth Management Group, said in an email. “The market has adapted to higher interest rates, slower growth, and global uncertainty, but is still trending higher. This shows confidence is real, and fundamentals will matter more than the (Federal Reserve) in 2026.”
After heavy losses earlier in the week, investors decided the sell-off had gone too far and returned to the market. It was also helped by the University of Michigan’s Consumer Sentiment Survey, which rose to its highest level since August, and short-term inflation expectations, which fell to 3.5%, the lowest level in more than a year.
“Inflation expectations have fully recovered from the ‘shock and awe’ of the April 2 tariff announcement,” Jeffrey Roach, chief economist at LPL Financial, said in a note. “Conditions remain fertile,” he said, predicting solid economic growth of 2.7% in the first three months of this year.
The Dow Jones Industrial Average rose 2.47%, or 1,206.95 points, to close at 50,115.67, while the S&P 500 composite index posted its worst weekly decline since last October, ending up 1.97%, or 133.90 points, at 6,932.30. The tech-heavy Nasdaq rose 2.18%, or 490.627 points, to close at 23,031.213, after falling 4.5% over the past three sessions. Before the rally, the Nasdaq was on its worst weekly decline since April 2025, when President Donald Trump first announced his tariff plans.
Bitcoin briefly fell below $61,000, its lowest since October 2024, and fell more than 50% from its all-time high of $126,000 in early October 2025, before rebounding about 12% to $70,287.83. The benchmark 10-year yield fell to 4.206%.
Is the labor market showing green shoots?
Employment agency Challenger, Gray & Christmas said the job cuts announced by employers in January were the biggest for the first month of the year since 2009, but some economists said there were signs the worst was over for the labor market.
Job growth continues to increase in the new year, according to Bank of America’s internal data. “At the same time, the increase in unemployment benefits seen in our data has leveled off and shows signs of decline,” the bank said in a Feb. 6 report. “Taken together, we think this paints an encouraging picture for the start of 2026.”
Will corporate profits remain steady?
Jeff Buchbinder, chief equity strategist at LPL Financial, said in a Feb. 5 commentary that the improving outlook for manufacturing gives him confidence in “the ability of U.S. companies to grow earnings at a double-digit pace for at least the next two quarters, and likely longer.”
He said the strong financial results will encourage further gains in the stock market this year.
Bolvin also expects double-digit earnings growth for the S&P 500 this year, but cautioned that “the road will not be smooth. Volatility should be expected” for stock gains.
(Updated with closing price)
Medora Lee is USA TODAY’s money, markets and personal finance reporter. Please contact us at mjlee@usatoday.com. Subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.
