Stocks Close-In on Record as Dollar Slide Deepens

Cameron Dawson, Chief Investment Officer at NewEdge Wealth, discusses how lofty 2026 earnings forecasts set a high bar for investors.

Wall Street traders sent stocks closer to their all-time highs on speculation that solid corporate earnings will keep powering market gains. The dollar slid to an almost four-year low. Gold held above $5,000.
Equities remained higher even after data showed consumer confidence hit the lowest since 2014. The S&P 500 approached 7,000. United Parcel Service Inc. - an economic barometer - gave a bullish outlook. Megacaps climbed before their results. Major insurers sank as the US proposed holding payments to private Medicare plans flat next year.
The dollar fell toward its lowest since February 2022 as signs of US support to boost the yen reinforced the argument about potential coordinated intervention to guide the greenback lower against key trading partners.
On the eve of the Federal Reserve decision, Treasuries barely budged. The central bank is projected to halt its rate-cutting cycle as a steadier jobs market restores a degree of consensus among officials after months of growing division.
The expected decision to hold rates is likely to amplify the outrage of President Donald Trump, who wants them slashed.
With the economy still displaying exceptional strength, the Fed’s messaging is likely to emphasize a data‑driven approach to future policy decisions, according to Chris Brigati at SWBC. Meantime, he said the tone from this week’s Magnificent Seven earnings should be solid, and upward revisions from analysts signal confidence is building.

The dollar slid to its weakest level in nearly four years as US policy risks and a resurgent yen weigh against the world’s reserve currency.
The Bloomberg Dollar Spot Index fell as much as 0.7% to the lowest since March 2022. It’s the fourth-straight day of losses, setting up the dollar for its worst stretch since President Donald Trump unveiled his program of universal tariffs last April.
The weakness reflects investor caution amid unpredictable Washington policymaking, including Trump’s threats to take over Greenland. Longer-term, risks around Federal Reserve independence, a growing budget deficit, worries about fiscal profligacy and widening political polarization have all pulled the dollar lower. 
“Structural drags on the dollar — fading confidence in US trade and security policy, politicization of the Fed, and worsening US fiscal credibility - could outweigh the more neutral cyclical dollar backdrop and pull the dollar lower,” said Elias Haddad, global head of markets strategy at Brown Brothers Harriman & Co. 
The declines helped to fuel gains across global currency markets. The euro soared to its strongest level since June 2021, and the British pound jumped to its highest since October of that year. The yen was also stronger after Japanese officials offered further hints that they could intervene in the market.
That followed signs of US support to boost the yen, reopening speculation around the potential for coordinated currency intervention to guide the greenback lower against key trading partners. Reports from traders Friday indicated the Federal Reserve Bank of New York contacted financial institutions to check on the yen’s exchange rate — a preliminary step that’s often taken before interventions. 
Friday’s rate-checking of the dollar-yen rate by Fed officials “drove down the US dollar further,” George Catrambone, head of fixed income at DWS Americas, told Bloomberg Radio on Tuesday.
The yen rallied some 0.7% to 153.03 Tuesday in New York. Japanese Finance Minister Satsuki Katayama, speaking after a Group-of-Seven meeting Tuesday, affirmed that the government will take appropriate action against currency moves in close coordination with US authorities if needed.
The drop in the dollar also buoyed the euro, which hit $1.1972 earlier, its strongest level since 2021. The pound rose 0.8% to $1.3791, also the highest since 2021, while the Swiss franc gained 1.4% to 0.7660 per dollar and continues to trade at its strongest mark since 2015.



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