The Atlanta Journal-Constitution
OTHER DEVELOPMENTS
Index soars to new milestone just five weeks after reaching 24,000.
» Stocks: The Dow Jones indus
trials closed above 25,000 for the first time, five weeks after the index topped 24,000.
NEWYORK— The Dow Jones industrial average burst through the 25,000-point mark Thursday, just five weeks after its first close above 24,000.
The Dow passed five 1,000point barriers in 2017 on its way to a 25 percent gain for the year, as an eight-year rally since the Great Recession continued to confound skeptics.
Strong global economic growth and good prospects for higher company earnings have analysts predicting more gains, although the market may not stay as calm as it has been recently.
The Dow has made a rapid trip from 24,000 points on Nov. 30, partly on enthusiasm over passage of the Republican-backed tax package, which could boost company profits this year with across-the-board cuts to corporate taxes.
“For a long while in 2017, I would say the biggest driver was excitement and anticipation over tax reform, but at a certain point I think there was a handover to global economic growth really helping to carry the stock market,” said Kristina Hooper, chief global markets strategist at Invesco.
Big gains in U.S. blue-chip companies have powered the Dow’s relentless rise to new heights over the past year, including an 87 percent gain in aerospace giant Boeing, a 70 percent rise in construction equipment maker Caterpillar and a 49 percent increase in Apple.
The Dow, which was founded in 1896 and is the oldest barometer of the U.S. stock market, has nearly quadrupled in value from its low during the financial crisis in early 2009. But the global economy and spending by people and businesses were much slower to recover than stocks were.
Stocks have continued to climb as investors saw signs economic growth was finally improving. Technology companies, which put up some of the biggest gains in the last year, continued to lead the market higher. And there was more good economic news Thursday: A report showed private U.S. businesses added 250,000 jobs last month, with smaller businesses adding 94,000.
The Dow, which tracks 30 big U.S. companies, rose 152.45 points, or 0.6 percent, to 25,075.13.
The Standard & Poor’s 500, a much broader index that professional investors prefer to use as their benchmark for large U.S. stocks, rose 10.93 points, or 0.4 percent, to 2,723.99.
The Nasdaq composite, which is heavily weighted with tech-
nology and biotech companies, added 12.38 points, or 0.2 percent, to 7,077.91. All three indexes set record highs a day earlier.
The Nasdaq reached a milestone of its own this week, closing above 7,000 for the first time Tuesday.
Indexes in some developing countries have done even better than those in Europe and the U.S. over the past year. Brazil’s benchmark Bovespa is up 28 percent over the past year and the Hang Seng index in Hong Kong is up 39 percent.
Bond prices fell, sending yields higher. The yield on the 10-year Treasury note rose to 2.45 percent from 2.44 percent. Higher bond yields are good news for banks because they can charge higher interest rates on mortgages and other kinds of loans.
President Donald Trump said Thursday that the Dow could reach 30,000, which would take another 20 percent jump. Few on Wall Street expect stocks to climb that much anytime soon. Stocks already did far better than most observers expected last year, and corporate earnings aren’t rising fast enough to justify that kind of climb.
It wasn’t all rosy Thursday. Intel continued to stumble after security researchers at Google and a group of academic institutions discovered serious security flaws in its computer processors. It lost 83 cents, or 1.8 percent, to $44.43 after a 3.4 percent decline Wednesday. Intel said it’s working to fix the problem.
Benchmark U.S. crude rose 38 cents to $62.01 a barrel in New York. Brent crude, used to price international oils, added 23 cents to $68.07 a barrel in London.
In other commodities trading, wholesale gasoline rose 1 cent to $1.81 a gallon. Heating oil fell 1 cent to $2.08 a gallon. Natural gas plunged 13 cents, or 4.3 percent, to $2.88 per 1,000 cubic feet.