Stocks closed mixed in Monday’s quiet session. While the equity market was open, the bond market was closed for the Columbus Day and Indigenous Peoples’ Day holidays. No earnings and economic reports were scheduled for release today, though the action picks up starting tomorrow.
At the close, the blue-chip Dow Jones Industrial Average was up 0.4% at 51,850, as Salesforce (CRM) climbed 2.1% on a double upgrade from BofA Securities analyst Tal Liani.
Liani lifted his rating on the Dow Jones stock to Buy from Underperform, the equivalent of Sell, and raised his price target to $285 from $160. Salesforce, which is down 12% year to date, hasn’t traded near $285 since May 2025.
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“Our prior concern centered on AI-driven disintermediation,” writes Liani in a note to clients. “However, conversations with CIOs and other market participants suggest that large enterprises (more than small-to-medium-sized businesses) are unlikely to replace platforms that house their business logic, data, workflows and compliance frameworks.”
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And AI, Liani adds, “should deepen dependence on these platforms.” He believes that Salesforce has a credible AI strategy and is poised for strong free cash flow generation.
The bull market celebrates its fourth anniversary
The broader S&P 500 (-0.06% at 7,807) and tech-heavy Nasdaq Composite (-0.4% at 27,245), meanwhile, finished slightly lower Monday.
The Dow is roughly 4.5% below its record high from early August, while the S&P 500 and Nasdaq are perched not far from the all-time peaks they notched last week.
Today marked the fourth anniversary of the current bull market. The S&P 500 has gained roughly 118% on a price return basis, “surpassing the historical average of ~90% and ranking as the third-strongest bull market since 1945. Along the way, it has produced 124 record highs, more than double the average (~50) of the seven prior bull markets that lasted at least four years,” says Raymond James Chief Investment Officer Larry Adam.
Adam adds that volatility has remained below average over the past four years, while earnings growth, rather than multiple expansion, has fueled the bull market’s returns.
And history suggests there’s more room to run. According to Adam, the average bull market lasts about five and a half years, with the fifth year averaging roughly 15% annually and finishing positive 90% of the time.
This week’s inflation data could spark volatility
And while today’s price action was relatively muted, “this week’s inflation data could be a near-term volatility trigger,” says Chris Larkin, managing director of Trading and Investing at E*TRADE from Morgan Stanley.
First up is the September Consumer Price Index (CPI) report, which will be released Wednesday morning. Headline inflation was “uncomfortably high” in August, writes David Payne, staff economist and reporter for The Kiplinger Letter, in the Kiplinger inflation outlook. The pickup was caused by higher gas and fuel oil prices, shelter costs and airfares, he explains.
And with energy costs likely to stay elevated as the situation in the Middle East remains unresolved, Payne believes the annual CPI rate will end the year at 4%, while core CPI, which excludes volatile food and energy prices, will be at 2.7%.
As for September, BofA Securities economists expect headline inflation to be higher than in August thanks to higher gas prices, while core inflation could moderate as tariff-related pressures ease. However, the group warns that core CPI could accelerate if airfares keep rising. If this happens, the Fed could be encouraged to raise interest rates in October for a second straight meeting.
Earnings season gets rolling this week
Larkin believes the new earnings season, which gets rolling this week, “may play a bigger role in shaping the market’s momentum into year-end, since it may signal how strong those tailwinds really are.”
Third-quarter earnings season is expected to be strong. FactSet Senior Earnings Analyst John Butters says current projections are for a 30% year-over-year S&P 500 earnings growth rate. If this is the actual earnings rate, it will mark the third straight quarter of year-over-year earnings growth, he adds.
This week’s earnings calendar features a handful of blue chip and financial stocks. Johnson & Johnson (JNJ, +0.9%) and JPMorgan Chase (JPM, +0.4%) kick things off bright and early Tuesday morning.