Dow closes above 11,000 mark for first time in 18 months
Wall Street’s year-old bull market reached another milestone on Monday, as the Dow Jones industrial average closed above the 11,000 level for the first time in more than 18 months.
The blue-chip Dow edged up 8.62 points, or less than 0.1%, to finish at 11,005.97. That is the highest close since Sept. 26, 2008 -- when stocks were crumbling as the credit crisis deepened.
Broader indexes also rose Monday, although the rally overall was relatively weak. The Standard & Poor’s 500 gained 0.2% to 1,196.48.
Financial markets worldwide were bolstered after the European Union on Sunday detailed the financial lifeline it’s offering to the Greek government, which is struggling to refinance huge debts.
U.S. stocks also climbed amid rising merger activity and on optimism about first-quarter earnings reports that will roll out beginning this week.
After the closing bell, aluminum giant Alcoa Inc. reported an operating profit of 10 cents a share for the first quarter, better than the 9-cents-a-share average estimate of Wall Street analysts, according to Bloomberg News data.
After stumbling in late January and early February, stocks have risen with few interruptions since Feb.8, underpinned by reports showing surprising strength in the U.S. economy.
The Dow is up 11% since Feb. 8, and is up 68% from its bear-market low of 6,547 reached in March 2009.
The market has continued to defy analysts who’ve asserted that share prices were getting ahead of the economy.
The start of earnings-reporting season will bring a new test for the bulls: Analysts expect operating earnings of the S&P 500 companies to be up 37%, on average, from a year earlier, according to Thomson Reuters.
Given the market’s recent surge -- the S&P 500 has risen for six straight weeks -- “I don’t think earnings will be a catalyst to drive stocks higher here,” said Barry Knapp, U.S. equity strategist at Barclays Capital in New York.
But even though a sell-off may be overdue, he said, optimism about a continuing economic recovery was likely to limit any pullback.
“The probability of a sharp decline is fairly low,” Knapp said. The S&P fell 8.1% from Jan. 19 to Feb. 8, before buyers took control again.
The Dow first crossed 11,000 in December 1999 -- which turned out to be the index’s last gasp of that era’s bull market. The Dow peaked at 11,722.98 on Jan. 14, 2000, then fell with the rest of the market into a long slide that ended in October 2002.
The next move above 11,000 came in January 2006, on the way to the Dow’s all-time closing high of 14,164.53 in October 2007.