Dow Closes at Record High
NEW YORK ( TheStreet) -- The Dow Jones Industrial Average closed at a record high on Tuesday, marking a new peak in a four-year rally that began in March 2009 at the depth of the financial crisis.
An uneven economic recovery notwithstanding, stocks have climbed from the bottom fueled by an ultra-easy monetary policy that has left few viable investment options outside equities.
In 2013, the Dow has gained 9%, on the back of a turnaround in housing and continuing improvement in corporate profitability and attractive valuations.
It was a read on the U.S. services sector Tuesday, which came in better than expected, that helped the Dow eclipse its previous 2007 peak.
"We made new highs and I think the rally is going to continue," said Peter Cardillo, chief market economist at Rockwell Global Capital. "The reason for that is low interest rates, which have been powerful ingredients for the market. From a technical standpoint, the market continues to strengthen on a daily basis despite negative news. We have signs of technical strength when the market doesn't fall apart even with negative news."
The Dow Jones Industrial Average surged 125.95 points, or 0.89%, at 14,253.77, after breaking through its all-time closing high of 14,164.53 and all-time intraday high of 14,198.10 achieved in 2007.
Breadth was overwhelmingly positive, with winners dominating losers 27 to two. Alcoa (AA) closed unchanged. Top gainers included Cisco(CSCO) , United Technologies (UTX) , Boeing(BA) and Hewlett-Packard(HPQ) .
Every major sector in the broad market rose, led higher by technology, capital goods, conglomerates and consumer cyclicals.
Apple(AAPL) shares surged 2.7% on rumors that the company may be releasing the next version of its iPhone sooner than anticipated .
Volumes on the New York Stock Exchange totaled 3.59 billion shares, and 1.88 billion shares on the Nasdaq. Advancers outpaced decliners by a ratio of 2.8-to-1 on the Big Board and 2.4-to-1 on the Nasdaq.
The ISM non-manufacturing index showed a rise to 56% in February from 55.2% in January, above the expected read of 55%.
The report's employment index decreased 0.3 percentage points to 57.2%, though indicated employment growth for the seventh consecutive month.
"Retail investors remained bullish in February following a seven-month trend, rotating out of higher performing stocks, choosing instead to buy stocks that have recently underperformed. " Steve Quirk, senior vice president of TD Ameritrade's Trader Group.
He added that in February retail investors were buying into stocks that were at lows, such as Apple(AAPL) , Facebook(FB) , 3D Systems (DDD) , Intel(INTC) and ConocoPhillips (COP) , and selling stocks that were at highs. Among those were Netflix(NFLX) , JPMorgan(JPM) , General Electric (GE) and Bristol-Myers(BMY) .