The stock market barreled higher yesterday, sending the Dow Jones industrials to a 3-1/2-year high as two Wall Street firms reported better-than-expected earnings and a brokerage...
NEW YORK — The stock market barreled higher yesterday, sending the Dow Jones industrials to a 3-1/2-year high as two Wall Street firms reported better-than-expected earnings and a brokerage gave tech-bellwether Intel a ratings upgrade.
The Dow rose 97.83 to 10,759.43. It was the best close for the Dow since June 13, 2001, surpassing the previous 2004 high of 10,737.70 set on Feb. 11.
Most Read Stories
- Students frustrated trying to get into UW’s strict engineering program
- Officials say damage to sewage plant in Discovery Park is catastrophic
- Mexico City is a parched and sinking capital
- T-Mobile one-ups Verizon’s new unlimited data plan; 4Q results top forecasts
- Downtown Eugene in ‘crisis,’ consultant says
Microsoft, one of the 30 Dow stocks, added 12 cents to close at $27.07 a share. Boeing, also a Dow stock, gained 20 cents to $53.42.
Broader stock indicators also made substantial gains. The Standard & Poor’s 500 index was up 10.80 at 1,205.45, just below the 3-1/2-year high of 1,205.72 set last Wednesday. The Nasdaq composite index gained 23.06 to 2,150.91, less than 12 points shy of last Wednesday’s multiyear high.
The good earnings news, along with the Intel upgrade, set a positive tone for the market throughout the session. Stocks also benefited from the traditional “Santa Claus” rally, as mutual funds and money managers shuffle their portfolios before the year ends.
“The company news that we’ve seen over the past few days has been, on balance, positive, and that’s giving investors the courage to buy,” said Hugh Johnson, chief investment officer for First Albany. “There’s definitely some window dressing going on as well, where you have portfolio managers making sure they have good performing stocks in their portfolios before year’s end. But for the most part, investors seem to be in a holiday mood.”
Stocks have climbed steadily since the presidential elections, with good economic data and positive profit forecasts for 2005 assuring investors of further returns.
Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee, said the market was being driven by an overall positive outlook for the economy, lower oil prices, historically low interest rates and seasonal buying that tends to lift shares in the last weeks of the year.
“There’s a lot of positives going on right now,” Berman said. “Even on the days where there has been bad news, the market has rebounded really well.”
While brokerage stocks remained volatile, the 2005 outlooks from Morgan Stanley and Bear Stearns renewed investors’ hopes that the first half of the new year will see continued economic and earnings growth.
Bear Stearns reported a 22 percent jump in profits, well above analysts’ forecasts, but its shares were off $1.80 at $102.70 as a possible sale of the company was seen as less likely. Morgan Stanley also beat expectations and gained 85 cents at $54.50 despite missing Wall Street’s revenue forecasts.
The tech sector got a lift after Lehman Brothers upgraded Intel to “overweight,” citing improved forecasts for spending in 2005. That cheered many investors who have been leery of building inventories and slow sales among a variety of technology companies.
On the strength of Lehman’s upgrade, Intel gained 79 cents to $23.49.