Dow and S&P 500 Hit Record Highs as Rate Cut Expectations Grow

Investors are increasingly confident in a September rate cut, buoying stocks and shifting market dynamics.

The Dow Jones Industrial Average surpassed 40,000, marking an all-time high, while the S&P 500 also reached record levels.
Retail sales in June were flat but exceeded expectations, reinforcing optimism about an economic slowdown and potential rate cuts.
Small-cap stocks, represented by the Russell 2000, surged 10% in five sessions, driven by lower inflation data and rate cut bets.
Political developments, including an assassination attempt on Donald Trump and his pick of Sen. J.D. Vance as running mate, influenced market sentiment.
The Federal Reserve is widely expected to lower interest rates by September, with markets pricing in a 100% likelihood of a cut.