Dow stuns with more than 1,200-pt gain to break 50,000 for first time

U.S. stocks surged on Feb. 6 in a stunning turnaround that saw the blue-chip Dow soar more than 1,200 points to pierce and close above the 50,000 mark for the first time ever.

"The Dow reaching 50,000 is less about celebration and more about confirmation," said Gina Bolvin, president of Bolvin Wealth Management Group, in an email. "Markets have adjusted to higher rates, slower growth, and global uncertainty—and still moved higher. That tells us confidence is real, and 2026 will be less about the (Federal Reserve) and more about fundamentals."

After steep losses earlier in the week, investors decided that the sell-off was overdone and returned to the market. A jump in the University of Michigan's consumer sentiment survey to the highest level since August and drop in short-term inflation expectations to 3.5%, the lowest level in just over a year, also helped.

"Inflation expectations have fully recovered from the ‘shock and awe’ from the April 2nd tariff announcements," said Jeffrey Roach, chief economist for LPL Financial, in a note. He forecasts solid 2.7% economic growth in the first three months of the year as "conditions remain fertile."

The Dow closed up 2.47%, or 1,206.95 points, to 50,115.67, while the broad S&P 500 backed away from registering its worst weekly drop since last October to end up 1.97%, or 133.90 points, to 6,932.30. The tech-heavy Nasdaq closed up 2.18%, or 490.627 points, to 23,031.213 after dropping 4.5% in the past three sessions. Before the rally, the Nasdaq was on pace for its worst weekly decline since April 2025 when President Donald Trump first announced his tariff plan.

Bitcoin rebounded about 12% to $70,287.83 after briefly falling below $61,000 to the lowest level since Oct. 2024 and more than 50% off from its record high of $126,000 from early October 2025. The benchmark 10-year yield dipped to 4.206%.

Labor market showing green shoots?

Although job placement firm Challenger, Gray & Christmas said employers announced in January the most job cuts for the first month of the year since 2009, some economists said they see signs the worst in the labor market has passed.

Payrolls growth continues to rise in the new year, according to Bank of America internal data. "At the same time, the rise in unemployment payments seen in our data has leveled off and is showing signs of declining," the bank said in a report on Feb. 6. "Taken together, we think this paints an encouraging picture at the start of 2026."

Will corporate earnings remain strong?

Jeff Buchbinder, chief equity strategist at LPL Financial, said in commentary on Feb. 5 an improving manufacturing outlook gives him confidence in "corporate America’s ability to grow earnings at a double-digit pace for at least the next two quarters, and probably longer."

Strong earnings will drive more stock market gains this year, he said.

Bolvin also forecasts double-digit S&P 500 earnings growth this year but warned stocks' upward "path won’t be smooth. Volatility should be expected."

(Updated with closing prices)

Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at [email protected] and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.