Dow closes above 13,000 for first time
EmptyNEW YORK -- It looks like a cause for celebration: The Dow Jones industrial average surged from 12,000 to 13,000 in just six months. But appearances can be deceiving, and there may be more reason to worry rather than rejoice about Wall Street's latest accomplishment.
Stronger-than-expected profits from several large companies helped push the stock market to historic heights. But many big corporations, including the Dow components, made a chunk of that money overseas, where economies are growing faster than in the U.S. And many of the same worries that weighed on investors earlier in the year remain: rising energy costs, a slumping housing market and a possible credit crunch.
Still, the stock market's best-known indicator surged past its latest milestone shortly after trading began Wednesday, and even made it past 13,100, rising as high as 13,107.45. According to preliminary calculations, it closed at 13,089.89, up 135.95 or 1.05%.
The broader market shared in the rally. The Standard & Poor's 500 index rose 15.01, or 1.01%, to 1,495.42, after reaching 1,496.59, a six-and-a-half-year high. The technology-dominated Nasdaq composite index advanced 23.35, or 0.92%, to 2,547.89, after hitting a six-year high of 2,551.39.
It took the Dow just 129 trading days, since Oct. 18, to make the trek from 12,000 to 13,000, far less than the 7 1/2 years that the blue chips took to go from 11,000 to 12,000. But the swiftness of this latest trip does recall the days of the dot-com boom when the major indexes were soaring and it took the Dow a mere 24 days to barrel from 10,000 to 11,000.
The Dow climbed to a record as many of the country's biggest companies surpassed analysts' first-quarter earnings projections. Among those beating forecasts Wednesday: soft-drink maker PepsiCo Inc., materials manufacturer Corning Inc. and Dow component Boeing Co.
Wall Street got an additional lift from the Commerce Department's report on durable goods last month, which showed a gain in orders of business capital goods and reassured investors that demand for U.S. products remains strong. The department also reported that sales of new homes rebounded slightly in March.