[New York Stock Market Morning Briefing] Dow & S&P close at record highs as Fed rate cut…big weekly gains

Dow, S&P 500, Nasdaq all rose…Apple and Tesla led gains

Russell 2000 turned lower…7-week winning streak maintained

Expert: "PER 22x…a correction could be a healthy development"

The three major U.S. stock indexes closed higher. The move came as the U.S. central bank (Fed) resumed a rate-cutting cycle and after U.S. President Donald Trump and Chinese President Xi Jinping held positive talks. The plan to hold the first summit of Trump's second term in South Korea in October also bolstered optimism.

On the 19th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 46,315.27, up 172.85 points (0.37%) from the previous session.

The S&P 500 rose 32.40 points (0.49%) to 6,664.36, and the Nasdaq Composite finished at 22,631.48, up 160.75 points (0.72%).

The small- and mid-cap index Russell 2000 fell 0.7%, which retraced some of its weekly gains after hitting an intraday record high earlier in the session.

Apple shares jumped 3.2% as the new iPhone launched worldwide, leading index gains. Tesla also rose more than 2.2%.

Major Wall Street indexes posted strong weekly gains. The S&P 500 and the Dow were up 1.2% and 1% respectively, while the Nasdaq gained 2.2%. The Russell 2000 climbed 2.2%, marking its seventh consecutive weekly gain.

This week's market was buoyed by the Fed lowering the policy rate by 0.25%percentage point. It was the first rate cut since December last year. The move had been largely anticipated by the market, but volatility widened intraday after Fed Chair Jerome Powell described the decision in a press conference as "risk management."

Mark Hackett, Nationwide's chief market strategist, said, "Historically, September often sees corrections, but this year the market has bucked that pattern, rising 35% since March. That is supported by strong technical and fundamental trends."

However, he added, "Considering that the S&P 500 is trading at a forward price-earnings ratio (PER) of about 22 times and that volatility is muted, a period of correction or choppy trading could be a normal and healthy development."

New York = Shin-young Park, correspondent nyusos@hankyung.com