Dow Hits Record High as Nasdaq Leads Monday Rally
Stocks roared back from the holiday weekend, but the USD finished mixed and Canada's services sector flashed a warning sign.
The Dow Jones Industrial Average punched to another record close Monday and the Nasdaq was the session's outperformer, driven by a fresh surge in AI and semiconductor names. The S&P 500 tagged along for a solid gain as traders came back from the long weekend in full risk-on mode. Don't get too comfortable though — market breadth was mixed, meaning the rally is still a narrow, tech-driven trade rather than a broad market melt-up.
The USD finished the day split down the middle. It scored its biggest win against the yen, up 0.45%, and also clocked gains versus the Swiss franc (+0.25%), Australian dollar (+0.22%), and New Zealand dollar (+0.12%). On the flip side, the greenback gave ground to the British pound (-0.26%) and barely budged against the euro (-0.03%). No clean trend here — pick your pairs carefully.
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The ISM Services PMI for June hit exactly 54.0, dead-on with estimates. That's a healthy expansion reading and confirms the U.S. economy is still chugging along despite tariff noise and geopolitical headwinds. Contrast that with Canada, where the S&P Global Services PMI cratered to 47.1 in June from 50.6 in May — that's contraction territory and a number you should not ignore if you're trading CAD pairs.
Fed Governor Christopher Waller took the microphone from a panel in Italy and defended forward guidance as a key policy tool, reaffirming the Fed's unwavering commitment to the 2% inflation target. Meanwhile, ECB's Schnabel pushed back against any idea of looking through current price pressures, while ECB's Wunsch noted that Iran-related inflation pass-through appears to have faded with limited second-round effects. Central bank divergence is alive — trade it accordingly.
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