The Dow nears 28,000 as stocks rally

The Dow Jones Industrial Average is zeroing in on breaking through 28,000 points, a new record

Amid an overall rally in US stocks, the major indexes are all set to close another week out with gains, driven by hopes for a trade deal and some better-than-expected retail sales data Friday.

It would be the fourth consecutive weekly increase for the Dow, and the sixth and seventh respectively for the S&P 500 and the Nasdaq Composite.

The Dow was up 0.7%, or nearly 200 points, and just about 25 points away from the 28,000 mark late Friday. The S&P was up 0.6% and the Nasdaq was up 0.5%.

“The Dow approaching the psychologically important 28,000 level is yet another sign that investors are regaining confidence in the pending trade truce with China and continued confidence in a US economy that is growing at a stable pace,” said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance.

All three have been hitting continuous records over the past weeks, and all three are on track to close at fresh all-time highs Friday.

White House Economic Adviser Larry Kudlow expressed optimism over a US-China trade deal on Friday, boosting investor sentiment. The countries agreed a “phase one” deal mid-October but have yet to sign it. In the meantime, the market has been getting mixed signals from officials, sometimes buoying and sometimes hurting hopes that a deal will be struck.

Meanwhile, economic data showed that the American consumer continues to be willing to spend, which is good news for US economic growth. Consumption accounts for some two-thirds to GDP growth.

October retail sales rebounded from a sluggish September, due mostly to gasoline store sales.

“Net, net, American shoppers returned to the stores and malls in October, but the coast isn’t clear yet for consumer spending in the fourth quarter of the year,” warned Chris Rupkey, chief financial economist at MUFG.