U.S. stocks advanced on Tuesday, with the Dow Jones Industrial Average setting another all-time high. The index rose 239 points, or approximately 0.5%, extending its recent run of record highs. The S&P 500 edged up 0.1%, and the Nasdaq Composite also traded 0.1% higher. This marked the third consecutive day of gains for major indexes, building on a rebound that began late last week.
The gains came despite fresh economic data pointing to a slowdown in consumer spending. The latest retail sales report showed consumer spending was flat in December, falling short of expectations for a 0.4% monthly increase. This followed a 0.6% rise in November. On a year-on-year basis, retail sales rose 2.4% in December, slowing from a 3.3% pace in November. The Commerce Department cited rough weather, tariff-related impacts, and persistently higher inflation as factors weighing on shopping activity.
Investor attention is now squarely focused on two high-stakes economic releases. The delayed U.S. non-farm payrolls (NFP) report is due on Wednesday, with economists expecting the economy to have created 70,000 jobs in January, up from 50,000 in December. The unemployment rate is expected to remain at 4.4%. This comes amid a wave of corporate layoffs, with companies announcing over 108,000 job cuts recently.
The most critical data point will be the January Consumer Price Index (CPI) report on Friday. Economists expect the headline CPI to fall to 2.5%. A lower-than-expected inflation figure could increase the odds of Federal Reserve interest rate cuts this year, which markets view as bullish. With stocks trading near record levels, these reports will be scrutinized for signs of cooling economic momentum or reaccelerating inflation pressures.
