Dow Jones Surges 175 Points, Closes In On All-Time Record
The Dow Jones surged 175 points on Wednesday to close in on an all-time record.
The sharp gain was the second in as many days as evidence continues to show the housing market is making a comeback. The Dow Jones industrial average closed on Wednesday at 14,075, up 175 points from Tuesday.
The Los Angeles Times notes that the number is up almost 300 points in the past two days. The gains put the Dow just 100 points of its all-time record high in October 2007.
Home builder stocks also surged on Wednesday as more positive news about housing came in. The Boston Globe reports that the Dow Jones saw broad gains.
Twenty-nine of the 30 stocks rose and all 10 industries in the Standard & Poor’s 500 index also climbed on Wednesday. Dan Veru, Chief investment officer of Palisade Capital Management, stated of the gains:
“The market psychology has clearly shifted. It’s no longer sell the rally, it’s buy the dips. The economic data continues to be strong.”
Investors were encouraged by the positive housing market, as well as the Federal Reserve Chairman Ben Bernanke standing behind the central bank’s low-interest-rate policies. He faced lawmakers for a second day.
Along with the gains in the stock market, the number of Americans who signed home contracts rose from December to January. Last month’s number was the highest level in almost three years. Sales of new homes also jumped by 16 percent to the highest level since July 2008.
Discount retailers also saw stocks rise on Wednesday. Dollar Tree jumped by 11 percent, while Dollar General saw a gain of 1.3 percent. Finally, Family Dollar Stores’ stock rose 2.5 percent. The yield on the 10-year Treasury note also gained two basis points to land at 1.90 percent.
There is hope that the Dow Jones will continue its surge on Thursday and break its all time record. The gains are coming, despite fears about the upcoming sequester and what their impact could be on the economy.
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