The Dow Jones Industrial Average crossed 52,000 for the first time in its 130 year history this week. Look past the headline and the record has less to do with the broader economy than with one company joining the index, and it landed the same week traders started pricing in a Fed rate hike instead of a cut.

Presented by Chaikin Analytics

I’m shouting ‘Buy Now’ before this stock soars

Editor's Note: If you don't know Marc Chaikin, he's a living Wall Street legend that famous investors like Steve Cohen owe a huge debt of gratitude to for helping them build billion-dollar businesses. He's even been nicknamed "The Billionaire Maker." So, when he comes out with a new stock recommendation, I pay attention. The one below is so promising, I had to share it with you today. And if you click any of the links in Marc's e-mail below, you'll get the name and ticker of the company he's pounding the table on absolutely free.

Dear Reader,

In 2023, my system flashed bearish on an automotive company virtually no one had yet heard of.

Soon after, the stock crashed 35%.

But today, that stock's outlook has made a full 180-degree turnaround.

Check it out:

My system now rates this company "Very Bullish," with extremely high marks across the most critical factors in my stock analysis.

Because the very same company my system warned about in 2023 just formed a groundbreaking partnership with the king of AI, Nvidia.

See, Nvidia has built what is essentially the brains of the AI-powered cars of the future.

But getting that brain inside vehicles and operating safely is an enormously complex job.

That's precisely the job that went to this company. (Get the name and ticker FREE right here.)

That partnership basically hands this barely-known company the keys to the self-driving kingdom on a silver platter.

So, if you want to benefit from a company quickly becoming the center of the massive autonomous-vehicle trend, forget Tesla and get this stock's ticker before it becomes a household name...

Sincerely,

Marc Chaikin

Founder, Chaikin Analytics

P.S. Autonomous cars are the future, and too many people make the mistake of thinking Tesla stock is the best way to profit. Not even close! Watch right here where I compare Tesla side by side with the company I'm talking about above and you'll see why it’s time to dump Tesla and buy this stock instead.

A Milestone Built on One Stock

On June 29, Alphabet officially replaced Verizon in the Dow, and the index closed above 52,000 for the first time, settling near 52,120. Alphabet shares jumped 4% that same day. Because the Dow is price weighted, a single high priced stock can move the whole index more than several smaller components combined. Alphabet now represents roughly 4% of the average, enough that a 5% swing in its stock alone can shift the Dow by more than 100 points. S&P Dow Jones Indices said the change was meant to modernize a 130 year old benchmark that had fallen behind the AI and cloud computing companies actually driving recent market gains. That is a story about index composition, not a fresh vote of confidence in the broader economy.

The Fed Just Got More Hawkish, Not Less

While the Dow was celebrating, the interest rate conversation moved in the opposite direction of what most households are hoping for. At its June 17 meeting, the Federal Reserve held rates steady, but new Chair Kevin Warsh used his first press conference to stress the committee was "unanimous and unambiguous" about fighting inflation. Traders responded by pricing a meaningfully higher chance of a rate hike in September, not a cut. Inflation data backs up the shift in tone. May's Consumer Price Index came in at 4.2% year over year, a three year high, with renewed Middle East tensions pushing energy costs up and feeding directly into that number.

Two Signals Pulling in Opposite Directions

A record stock index usually reads as an all clear signal. A Fed leaning toward hikes usually reads as a warning. Both are happening in the same week, and they are pointing in opposite directions. Bank of America now expects three separate quarter point hikes this year, which would push the benchmark rate from its current range near 3.50% to 3.75% up toward 4.25% to 4.50%. That is not a small move for anyone carrying a variable rate loan, a credit card balance, or a mortgage tied to a rate that resets.

Final Take

If you own stocks through a 401(k) or brokerage account, the Dow crossing 52,000 is a real number and it counts. But do not read it as proof the economy is cooling off or that borrowing is about to get cheaper. The opposite case is building. A rate hike instead of a cut would mean higher costs on credit cards, auto loans, and any adjustable rate debt, right as the headlines are telling you things have never looked better. The record and the rate outlook are not telling the same story, and the rate outlook is the one that will actually show up in your monthly bill.

Written by Deniss Slinkins
Millionaire Core