Dow Jones reaches historic 40,000 mark

Major stock indexes were hitting or nearing records in February 2024, as they were in early 2020 when this TV chyron appeared. AP Photo/Richard Drew The Dow Jones Industrial Average topped 40,000 for the first time on May 16, 2024. It spent the next few hours hovering around that mark, occasionally dipping under. But the breakthrough, even if fleeting, nonetheless marks another symbolic milestone in a monthslong bull market, coming three months after the S&P 500 index surpassed 5,000 for the first time. The Conversation asked Alexander Kurov, a financial markets scholar, to explain what stock indexes are and to say whether these kinds of milestones are a big deal or not. What are stock indexes? Stock indexes measure the performance of a group of stocks. When prices rise or fall overall for the shares of those companies, so do stock indexes. The number of stocks in those baskets varies, as does the system for how this mix of shares gets updated. The Dow Jones Industrial Average, also known as the Dow, includes shares in the 30 U.S. companies with the largest market capitalization – meaning the total value of all the stock belonging to shareholders. That list currently spans...