Dow Jones Passes 11,000 Mark for First Time Since 9/11
July 7, 2008 - 8:22 PM
(CNSNews.com) - The Dow Jones Industrial Average hit a major milestone on Monday by ending the trading session over 11,000 for the first time since before Sept. 11, 2001. The rising tide also lifted two other major markets to their highest levels in more than four and a half years.
While the Dow rose 52.59 points to 11,011.90, the Nasdaq Composite Index climbed 13.07 points to reach 2,318.69, and the Standard & Poor's 500 Index gained 4.70 points to hit 1,290.15.
Monday marked the fifth consecutive session in positive territory by all three markets since trading began for 2006 last Tuesday. After gaining 241 points last week, the Dow began the new week by reaching its highest level since June 13, 2001.
Nevertheless, analysts were divided over just what the surge in stock prices means in the long term.
The impact of the Dow topping 11,000 is "psychological and hard to measure, but clearly, you can't dismiss it," Hugh Johnson, chairman of asset management company Johnson Illington Advisors, told CNN. "If it wakes up investors, then it is of some value."
However, Art Hogan, chief investment strategist at Jefferies & Co., told the Associated Press that the rally "sends a signal that the U.S. economy has weathered some pretty harsh storms over the past few years and in recent months."
One factor that contributed to Monday's gains was a 7 percent jump in General Motors Corp. stock, a result of Goldman Sachs raising the automaker's rating to "in-line" from "underperform."
Also climbing 7 percent were shares of XM Satellite Radio, which gave the Nasdaq a boost after Deutsche Bank raised the satellite radio provider's rating. Sirius Satellite Radio also gained 1 percent as the Howard Stern show debuted on the service.
To make the rally complete, oil prices slid Monday due to mild weather in the Northeast. Light, sweet crude for February delivery dropped 71 cents to $63.50 per barrel on the New York Mercantile Exchange.
Still, not all the news was good on Wall Street. IBM was the Dow's biggest loser as shares tumbled over 1.5 percent when the company was downgraded to "neutral" from "overweight" at J.P. Morgan.
Over the next few days, key economic data on retail sales and wholesale prices will be released, though experts doubt that even with the best of news, the Dow will not surpass its highest reading of 11,722.98 -- reached on Jan. 14, 2000 -- anytime soon.
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