On the New York Stock Exchange, the Dow Jones Industrial Average has moved above 14,000 for the first time ever. Investors were encouraged by a relatively mild inflation report and better-than-expected profits from leading companies including beverage maker Coca-Cola and brokerage firm Merrill Lynch.
The Dow – which rose just 1,000 points from 1990 to 1995 – had hit 11,500 by the year 2000 and then tumbled after the September 11th attacks.
Equity Strategist Sam Stovall said it is a good sign that the index can recover so quickly from setbacks: “When you have the recouping of all of the losses from a prior bear market, which is what the S&P 500 did back on May 30th of this year, I think going forward it adds confirmation that this bull market is alive and well.”
The Dow had taken just 57 trading days to make the trip from 13,000 to 14,000, boosted by mergers and acquisitions and despite higher fuel prices and the ongoing problems in the US housing market and mortgage lending industry. Economists say, for the moment, consumers are spending and companies remain optimistic about the future.