World
The Dow just crossed 40,000 for the first time. The number is big but means little for your 401(k)
NEW YORK (AP) — The Dow Jones Industrial Average just topped 40,000 for the first time, the latest pop in what’s been a surprisingly good year for Wall Street.
But just like New Year’s represents an arbitrary point in time in the Earth’s revolution around the sun, such milestones for the Dow don’t mean that much inherently.
For one, with just 30 companies, the Dow represents a tiny slice of Corporate America. For another, almost no one’s 401(k) account sees its performance depend on the Dow, which has become more of a relic used for historical comparisons.
Here’s a look at what the Dow is, how it got here and how its use among investors is on the wane:
WHAT IS THE DOW?
It’s a measure of 30 established, well-known companies. These stocks are sometimes known as “blue chips,” which are supposed to be on the steadier and safer side of Wall Street.
WHAT’S IN THE DOW?
Not just industrial companies like Caterpillar and Honeywell, despite the name.
The roster has changed many times since the Dow began in 1896 as the U.S. economy has transformed. Out, for example, was Standard Rope & Twine, and in recently have been big technology companies.
Apple, Intel and Microsoft are some of the newer-economy names currently in the Dow. The financial industry also has a healthy representation with American Express, Goldman Sachs, JPMorgan Chase and Travelers. So does health care with Amgen, Johnson & Johnson, Merck and UnitedHealth Group.
WHAT’S ALL THE HUBBUB NOW?
The Dow just crossed its latest 10,000 point threshold to top 40,000 briefly in midday trading on Thursday. It took about three and a half years to make the leap from 30,000 points, which it first crossed in November 2020.
It’s kept chugging mostly higher despite the worst inflation in decades, painfully high interest rates meant to get inflation under control and worries that high rates would make a recession inevitable for the U.S. economy.
Companies are now in the midst of reporting their best profit growth in nearly two years, and the economy has managed to avoid a recession, at least so far.
IS THE DOW THE MAIN MEASURE OF WALL STREET?
No. The Dow represents only a narrow slice of the economy. Professional investors tend to look at broader measures of the market, such as the S&P 500 index, which has nearly 17 times the number of companies within it.
More than $11.2 trillion in investments were benchmarked to the S&P 500 at the end of 2019, according to estimates from S&P Dow Jones Indices. That’s 350 times more than the $32 billion benchmarked to the Dow Jones Industrial Average.
Investors’ 401(k) accounts are much more likely to include an S&P 500 index fund than anything tied to the Dow. The S&P 500 crossed above its own milestone Wednesday, topping 5,300 points for the first time.
That’s what more investors care about. Well, 100-point milestones matter for the S&P 500 as little as others, but the fact that the S&P 500 is higher than ever matters a lot.
HOW DIFFERENT ARE THE DOW AND THE S&P 500?
Their performances have historically tracked relatively closely with each other, but the S&P 500 has been better recently. Its 29.3% rise for the last 12 months easily tops the 21.1% gain for the Dow.
That’s in part because the S&P 500 has more of an emphasis on Big Tech stocks, which were responsible for most of the S&P 500’s gains last year. Hopes for an easing of interest rates by the Federal Reserve and a frenzy around artificial-intelligence technology have pushed them to dizzying heights.
The Dow reflects none of the movements of such marquee stocks as Alphabet, Meta Platforms or Nvidia.
IS THAT IT?
No, the Dow and S&P 500 also take different approaches to measuring how an index should move.
The Dow gives more weight to stocks with higher price tags. That means stocks that add or subtract more dollars to their stock price push and pull it the most, such as UnitedHealth Group and its $523 stock price. A 1% move for that stock, which is about $5, packs a radically harder punch than a 1% move for Walmart, which is about 63 cents
The S&P 500, meanwhile, gives more weight to stocks depending on their overall size. That means a 1% move for Walmart carries more weight than a 1% move for UnitedHealth Group because Walmart is a slightly bigger company by total market value.
SO WHY CARE ABOUT THE DOW?
Because it’s so old, it has a longer track record than other measures of the market.
For a while, a triple-digit move for the Dow also offered an easy shorthand way to show the stock market was having a big day. Now, though, it means much less. A 100 point swing for the Dow means a move of less than 0.3%.
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World
Celine Dion Makes Triumphant Comeback at Paris Olympics Opening Ceremony — Watch Full Performance
![Celine Dion Makes Triumphant Comeback at Paris Olympics Opening Ceremony — Watch Full Performance Celine Dion Makes Triumphant Comeback at Paris Olympics Opening Ceremony — Watch Full Performance](https://tvline.com/wp-content/uploads/2024/07/celine-dion-olympics-performance-video.jpg?w=650)
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World
95 Libyan nationals arrested in South Africa at suspected secret military training camp
![95 Libyan nationals arrested in South Africa at suspected secret military training camp 95 Libyan nationals arrested in South Africa at suspected secret military training camp](https://static.foxnews.com/foxnews.com/content/uploads/2024/07/South-Africa-Secret-Military-Camp.jpg)
South African police arrested 95 Libyan nationals in a raid on a suspected secret military training camp on Friday and authorities said they were investigating whether there were more illegal bases in other parts of the country.
The camp was discovered at a farm in White River in the Mpumalanga province, about 360 kilometers (220 miles) northeast of Johannesburg, police said.
ELEPHANTS KILL TOURIST IN SOUTH AFRICA AFTER HE TRIED TO GET CLOSE TO TAKE PICTURES
National police spokesperson Athlenda Mathe said in a post on the social media site X that the Libyans stated they had entered the country on study visas to train as security guards, but police investigations suggest they have received military training.
The Newzroom Afrika TV news channel broadcast pictures of the site of the arrests, showing a military-style camp with large green and khaki tents set up in a row. Dozens of men were seen lining up as they were arrested. They were wearing civilian clothing.
Local government official Jackie Macie said investigations were ongoing and the owner of the farm would be questioned. He said authorities received information that there were similar secret camps near two other towns in Mpumalanga province.
A camp where 95 Libyan nationals were arrested on suspicion of running an illegal military camp are seen lining up after their arrest on Friday, July 26, 2024 in White River, South Africa. Police say that 95 Libyan nationals were arrested on suspicion of receiving training at a secret military camp in the north of the country. (AP Photo/Bulelwa Maphanga)
The province borders neighboring countries Mozambique and Swaziland and is an area of concern for South African authorities with regards to illegal immigration.
Police and authorities have not said whether the camps are suspected of being connected to a particular group or conflict.
Macie said investigations would establish if there was a network of camps in South Africa and show “why they are here doing military training in our country.”
Police said the men may be linked to crimes reported in communities close to the farm in recent months.
“We have serious cases which have been opened with the police, including cases of rape and armed robberies, which complainants claim were committed by unknown foreigners who seem to be of Asian descent,” said police spokesman Donald Mdhluli.
“We take what we have found here today very seriously because we don’t know who was training them, what were they being trained for and why that training is happening here in South Africa. It may be a threat not only to South Africa but also to the entire southern Africa region.”
Police said the operation to arrest the Libyans and close down the camp began two days ago. Macie said the Libyan nationals had been in the country since at least April.
“The 95 individuals taken into custody are all Libyan nationals and are currently being questioned by the relevant authorities,” Mpumalanga acting provincial police commissioner Maj. Gen. Zeph Mkhwanazi said in a statement.
Mdhluli, the police spokesman, said the country’s security regulator had confirmed that the kind of training that appears to have been taking place at the camp was well beyond the scope of training for security guards.
“The kind of equipment we found here shows that there was intense military training taking place here. This was basically a military base.”
World
Passengers face long, uncertain wait at stations amid rail disruption
![Passengers face long, uncertain wait at stations amid rail disruption Passengers face long, uncertain wait at stations amid rail disruption](https://static.euronews.com/articles/stories/08/60/76/94/1200x675_cmsv2_f96d39cf-cf5a-5a0e-9323-49dbeb24b261-8607694.jpg)
A deliberate fire in a signal box about 60 km south of Lille caused the disruption on the northern high-speed line, with traffic halted around 5 a.m. local time on Friday.
Travel was severely disrupted in Lille on Friday, one of the stations affected by the sabotage that hit major French rail lines ahead of the Paris Olympics opening ceremony.
Many passengers waited with hope that soon turned to resignation.
“We’ve been waiting since 10:38 a.m. for the 11:38 a.m. train, and now we’re just waiting for it to arrive at 2:08 p.m.,” said Delphine, one of the stranded passengers.
“It’s still quite a delay, and we’ll be even later since we’re on a secondary route. I work in Avignon at 9 p.m., so it’s going to be very, very tight. We have a concert tonight — will it even happen? This is all very confusing, and we don’t understand what’s going on.”
For one traveller, this was a rough start to the holidays. “The worst case would be if the train is cancelled entirely and we have to buy new tickets for next week. It would shorten our already brief vacation. That would be a huge problem,” said Hippolyte.
When asked if he had been informed of the delays, Hippolyte said he received the notification just before departure.
“At around 10 a.m. this morning, we were told we were an hour late and would be leaving at 1 p.m.”
“It just keeps getting later as the day goes on. Every time we approach the new departure time, it gets pushed back another hour and a half, or half an hour each time.”
A deliberate fire in a signal box about 60 km south of Lille caused the disruption on the northern high-speed line. Traffic was halted around 5 a.m. on Friday.
The recent acts of sabotage on the rail network highlight that the Olympic Games are turning France into a prime target.
The attack disrupted the transport system on the opening day of the Games, causing delays of up to two hours or even cancellations that affected hundreds of thousands of passengers nationwide.
Authorities in Paris have said they are deploying substantial human resources to counter any threats and to ensure the safety of the events.
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