Dow closes in on record as housing sparks stock surge
NEW YORK -- The Dow came within 100 points of its all-time high Wednesday after rising sharply for a second straight day.
The market surged following more evidence that the Fed will keep interest rates low, housing will keep recovering and shoppers aren't pulling back on spending, even with a payroll tax hike.
The gains were broad: Twenty-nine of 30 stocks in the Dow Jones industrial average rose. All 10 industries in the Standard and Poor's 500 index climbed.
The Dow Jones industrial average rose 175.24 points, or 1.2 percent, to 14,075.37. The index is now less than 100 points away from its record close of 14,164 reached in October 2007.
The Dow has surged 290 points in the past two days, erasing its drop of 216 points Monday when inconclusive results from an election in Italy renewed worries that Europe's fiscal crisis could flare up again.
"The market psychology has clearly shifted. It's no longer sell the rally, it's buy the dips," said Dan Veru, chief investment officer of Palisade Capital Management. "The economic data continues to be strong."
Stocks have surged since the start of the year. The Dow is up 7.4 percent.
Earnings for S&P 500 companies will climb 7.8 percent in the fourth quarter, the third straight quarter of growth, according to data from S&P Capital IQ.
The Standard and Poor's 500 index gained 19.05 points, or 1.3 percent, to 1,515.99. The Nasdaq composite rose 32.61 points, or 1.3 percent, to 3,162.26. The index is 6.5 percent higher for the year, and is about 3.1 percent short of its record close of 1,565.