New Haven Register (New Haven, CT)
Dow crests 34,000 on proof economy recovering
Wall Street notched more milestones Thursday, as a broad market rally pushed the S&P 500 to an all-time high and the Dow Jones Industrial Average crossed above the 34,000 mark for the first time.
The S&P 500 rose 1.1 percent, with technology, health care and communication stocks accounting for much of the upward moves. Only energy and financial companies closed lower. Bond yields fell.
The rally came as investors welcomed a suite of encouraging economic reports showing how hungry Americans are to spend again, how fewer workers are losing their jobs and how much fatter corporate profits are getting.
Expectations are very high on Wall Street that the economy — and thus corporate profits — are in the midst of exploding out of the cavern created by the pandemic, thanks to COVID-19 vaccinations and massive support from the U.S. government and Federal Reserve. New data on retail sales and jobless claims Thursday helped bolster the view that the economic recovery is accelerating.
“Another day, another record,“said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance. “The stock market continues to validate the optimistic forecasts from last year, which predicted a strong economy that was driven by consumers emerging from their homes, emboldened by vaccinations or by a belief that the worst of COVID was behind us.”
The S&P 500 rose 45.76 points to 4,170.42, surpassing its previous record high of 4,141.59 set on Tuesday. The Dow climbed 305.10 points, or 0.9 percent, to 34,035.99. The Dow also set a record high on Friday.
The Nasdaq composite added 180.92 points, or 1.3 percent, to 14,038.76, while the Russell 2000 index of smaller companies picked up 9.35 points, or 0.4 percent, to 2,257.07.
The rally got off to a swift start Thursday as traders weighed the latest batch of economic data and corporate earnings reports.
One report showed that U.S. retail sales jumped 9.8 percent in March from February, blowing past economists’ forecasts for 5.5 percent growth. Much of the surge was due to $1,400 payments from the U.S. government’s latest economic rescue effort hitting households’ bank accounts.
Economists said it shows how primed people are to spend as the economy reopens and conditions brighten. That’s huge for an economy that’s made up mostly of consumer spending.
Another report gave an encouraging read on the job market, showing 576,000 people applied for unemployment benefits last week.
That’s well below the 700,000 that economists had forecast and down from 769,000 the prior week.
It’s also the lowest the number has been since the pandemic.