Wall Street reached yet another milestone Thursday as it continues its impressive streak of gains in 2013, despite mixed economic news.
Three weeks after the Dow Jones industrial average blew through its previous all-time high, the broader Standard & Poor’s 500 index followed suit Thursday.
The S&P 500 rose less than 1 percent to close at 1,569.19, ticking past its previous record closing high of 1,565.15 set on Oct. 9, 2007. The broad index had been flirting with the mark for more than a month.
The record-break mark comes just weeks after the Dow, which tracks 30 top industrial stocks, flew past its previous record of 14,164.53, also set on Oct. 9, 2007.
The Dow closed at 14,253.77 on March 5. Thursday it closed at 14,578.54.
The Dow and S&P both have contributed to Wall Street’s strong year thus far. The S&P is trading 10 percent higher than where it opened in 2013 — meaning that in the first three months of the year it already has grown nearly as much as the 13 percent gain it posted in all of 2012. The index was flat in 2011.
Meanwhile, the Dow’s 11 percent gain since the beginning of the year already has far surpassed its steady yearly gains of 7 percent and 6 percent in 2012 and 2011, respectively.
The Nasdaq composite index, which closed Thursday at 3,267.52, remains a long way from its March 2000 high of 5,048.62, set during the dot.com technology stock boom. But it also is up nearly 6 percent since the beginning of the year. That’s about half of the 14 percent rise it saw in all of 2012.
“It feels like there’s exuberance creeping back into the economy and into investing psyches,” said Sheyna Steiner, senior investing analyst at Bankrate.com. “People are feeling more positive about their finances. That’s certainly contributing to people’s appetite for risk.”
Wall Street analysts point to several factors that are driving market growth: U.S. job growth, shrinking unemployment, the strengthened manufacturing sector and improving housing sector.
“Stocks have been higher for a few months now,” said Paul Edelstein, director of financial economics at IHS Global Insight.
“Investors are more willing to take on risks and pay more for stocks, because they see a better growth picture in the U.S., and they see less risk coming from Europe.”
That’s not to say Europe’s troubles are over — but investors believe it is less likely the problems over there will spread to the U.S., he said.
“There are a lot of positives in the U.S. recovery that weren’t around this time last year,” Mr. Edelstein added.
But that doesn’t mean everything is great in the U.S.
“It seems a little puzzling seeing that the U.S. economy is not doing as well as people thought and with everything that’s going on in Europe,” Ms. Steiner said. “There seems to be a disconnect.
“I would not say the stock market gain is artificial, but it certainly feels like the stock market has been more willing to shrug off bad news and react very positively to good news than at other times.”
• Tim Devaney can be reached at tdevaney@washingtontimes.com.
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