Stocks push higher; some indexes hit new bull-market highs
Major U.S. stock indexes were at or near new multiyear highs on Wednesday, as the bulls stay in control with less than two trading days left in the first quarter.
The Dow Jones industrial average (charted below) was up 99 points, or 0.8%, to 12,378 at about 10:40 a.m. PDT, within easy reach of its 2 1/2-year closing high of 12,391 set on Feb. 18.
[Updated at 1:15 p.m. PDT: The Dow closed up 71.60 points, or 0.6%, to 12,350.61.]
Some indexes now have overtaken their previous peaks. The Russell 2,000 small-stock index was up 1.1% to 838.63, topping the recent closing high of 834.82 set on Feb. 18.
Barring a steep sell-off between now and Thursday’s closing bell, the major indexes will post first-quarter gains of 5.5% to 8.5%. The Dow industrials are up 6.9% so far.
Stocks have overcome a barrage of dismal headlines since mid-February, including Mideast unrest, surging commodity prices, more government-debt woes in Europe and Japan’s nuclear crisis.
“This market has climbed the proverbial ‘wall of worry,’ ” said Jeffrey Rubin, director of research at Birinyi Associates in Westport, Conn.
Joe Saluzzi, a veteran trader at Themis Trading in Chatham, N.J., puts it another way: The market, he says, has done what was needed to provoke “maximum frustration” among investors who were logically anticipating a significant pullback in the face of a world of trouble.
A pullback did happen, but not the 10% or greater “correction” many analysts said was overdue. The decline ended with the Dow at 11,613 on March 16, down 6.3% from its Feb. 18 high.
Even as the market has resumed its climb since mid-March skeptics have pointed to light trading volume, suggesting there’s little conviction behind the rebound.
But Wall Street bulls say stocks’ resilience shows that most investors are staying focused on the idea that the U.S. economic recovery will continue. A report Wednesday on private-sector job growth in March helped underpin optimism.
If you buy the continuing-recovery theme, the primary alternatives to stocks -- cash accounts paying nearly nothing and bonds at relatively low yields -- don’t have much appeal, said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.
“So people have thrown in the towel and come back to equities,” he said.
-- Tom Petruno