The Dow Jones Industrial Average soared over 500 points, closing above 42,000 for the first time, following the Federal Reserve's historic 50 basis point interest rate cut, which adjusted the federal funds rate to 4.75-5.0%. Fed Chair Jerome Powell described the cut as a 'recalibration' aimed at maintaining economic strength amidst falling inflation and employment risks. This significant market rally also saw the S&P 500 and Nasdaq reach new record highs, with technology and consumer discretionary stocks leading the gains. Analysts project additional rate cuts in the upcoming years, with Goldman Sachs forecasting a neutral rate of 3.25-3.5% by mid-2025. The market's optimistic response reflects confidence in the Fed's ability to navigate inflation control while promoting growth, despite some skepticism about future economic conditions. Notable contributors to the Dow's rise included McDonald's, 3M, and IBM, while tech stocks like Nvidia also saw substantial increases.