The Dow Jones Industrial Average hit a record high on Tuesday as it rallied for a second day, boosted by gains in Intel and optimism around global trade after the new trade pact replacing NAFTA called U.S.M.C.A, was announced by President Trump.
The 30-stock index closed 122.73 points higher to 26,773.94 for its first record close since Sept. 21. Intel climbed more than 3.5 percent, while Boeing soared to an all-time high. These gains added to the 192-point pop in the Dow on Monday to start the fourth quarter, CNBC reported.
The new trade pact which was released Sunday Text of the pact, includes major adjustments in several key areas of the countries’ trading relationships, between U.S, Mexico and Canada, including new rules for automobile production, meant to incentivize production of cars and trucks in countries that pay higher wages. It reduces barriers for American dairy farmers to sell cheese, milk and other products to Canada, The NY Times reported.
Financial analysts look at the new trade pact as a sign that the “trade war” is letting up and looked at this as a sign of relief, and the news of the pact resulted in the DOW explosion.
“The market reaction suggests investors are less worried about a trade war,” Jennifer Ellison, principal at BOS told CNBC. “It’s more of a sigh of relief.”