Dow, S&P 500 hit fresh records to cap strong September, quarter

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US stocks bid farewell to the month and the quarter with fresh records as investors reacted to Federal Reserve Chair Jerome Powell vowing to do what it takes to keep the economy humming, while signaling he won't rush future rate cuts.

The S&P 500 (^GSPC) rose 0.4% to close at a new record, while the Nasdaq Composite (^IXIC) gained close to 0.4%. Meanwhile, the Dow Jones Industrial Average (^DJI) finished just above the flatline, securing its latest all-time-high.

Typically the cruelest month for stocks, Wall Street indexes recorded monthly wins to close out the last trading day of September. Notably, the S&P 500 notched its best year-to-date performance at September's end since 1997. The S&P also enjoyed its best quarter since the fourth quarter of 2021.

Over the last three months, the Dow led the major indexes' gains, up 8.2%. The S&P gained 5.4%, and the Nasdaq added nearly 3%.

The Federal Reserve's jumbo interest rate cut and signs of resilience in the US economy have lifted confidence, helping stocks post three weekly wins in a row. The final trading day of the month and the quarter also came with profit taking and rebalancing.

Investors are now bracing for the September jobs report, due out on Friday, which is seen as posing an important test for the recent rally. The pressing question is just how quickly the labor market is slowing as the market weighs whether the Fed has acted aggressively to protect a healthy economy or to help a flailing one.

"Overall, the economy is in solid shape; we intend to use our tools to keep it there," Powell said in a speech before the National Association for Business Economics in Nashville, Tenn. His remarks come days ahead of the the crucial monthly jobs report.

Powell's comments on not rushing the next round of rate decisions also lowered expectations of another jumbo cut.

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