U.S. stocks jumped Thursday following the Federal Reserve’s decision to go big with a 50 basis point cut to rates of interest.

The Dow Jones Industrial Average closed above 42,000 for the first time, ending the day up 1.3% at a record 42,025.19. The S&P 500 also ended the day at a record high for the first time since July, closing up 1.7% at 5,713.64. The Nasdaq composite also saw gains, ending the day up 2.51%.

The surge comes after the Consumed Wednesday announced a half-point rate of interest cut, its first cut in 4 years. The central bank expects a half-point in additional cuts throughout the remaining of the 12 months, a sign of confidence inside the labor market.

“Markets like rate cuts, especially big ones when the economy is strong,” said Jamie Cox, Managing Partner for Harris Financial Group, in an email statement.

Eight of the S&P 500’s 11 sector indexes rose, and tech stocks saw amongst crucial gains. Apple ended the day up 3.7%, Meta up 3.9% and Tesla up 7.4%.

Fed rate cuts: Lower mortgage rates will bring much-needed normalcy to the housing market

What does this mean for my 401(k)?

Wall Street’s performance is welcome news for investors stashing away money in retirement savings accounts.

USA TODAY has previously reported that the S&P 500 is considered top-of-the-line gauges of Wall Street’s health. When the benchmark index goes up, American’s 401(k)s are more likely to rise as well.

“This is excellent, good news for all of us saving for retirement,” said Quincy Krosby, chief global strategist for LPL Financial. While future pullbacks and bouts of volatility are to be expected, “overall, historically, the trail for the markets is higher.”

This text originally appeared on USA TODAY: S&P 500, Dow close at record highs after Federal Reserve rate cuts