More stocks are joining the gangbusters rally. That’s good news for investors

The dwindling ranks of the Magnificent Seven are finally getting reinforcements. The S&P 500, Dow Jones and Nasdaq all notched record highs Wednesday and Thursday.

A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link. The dwindling ranks of the Magnificent Seven are finally getting reinforcements. The S&P 500, Dow Jones Industrial Average and Nasdaq Composite indexes notched record highs on Wednesday and Thursday after the Federal Reserve reiterated its forecast for three quarter-point rate cuts in 2024. Investors had worried that the central bank would adjust its expectations to fewer than three cuts following a slate of hot inflation data in recent months. But more stocks than just Big Tech have paved the way higher. The S&P 600 index, which tracks American small-cap stocks, just turned positive for the year. That’s good news for Wall Street, because smaller companies generate most of their revenue from US customers, making them bellwethers of the US economy. Small caps are often active in sectors like financials and industrials that tend to rise and fall with wider economic activity. “When you see small-cap industrials leading, that’s usually a sign that the market is saying things are on pretty firm footing here,” said Ryan Detrick, chief market strategist at Carson Group. Their participation also shows that the market’s surge is extending beyond tech giants. That’s a welcome sign for investors, since a broader rally begets a healthier rally. When the market’s gains don’t depend on just a handful of names, they’re less vulnerable to pullbacks.