Mon | Jan 23, 2017

Dow touches 11,000, fleetingly

Published:Sunday | April 11, 2010 | 12:00 AM

The stock market closed at a new 18-month high Friday, with the Dow Jones industrial average briefly touching 11,000 before retreating slightly.

The gains were driven by fresh signs that the economy continues to recover and suggests that investors don't expect the economy will slide back into recession.

Many analysts are still sceptical that the market's gains are sustainable since they have come on relatively low volume, indicating that many investors are still sitting on the sidelines.

The Dow very briefly touched 11,000 in the final five minutes of trading before ending with a gain of 70 points.

The market closed at 10,997.35.

It hadn't crossed that level since September 29, 2008, just as the worst phase of the financial crisis was beginning.

Stocks got a boost after reassuring statements from Greece's finance minister and the head of the European Central Bank. Major European indexes closed higher, while the dollar fell against the euro.

Stocks fluctuating

Major indexes pulled back briefly after Fitch Ratings cut its view on Greece's debt, but quickly recovered. Stocks have been fluctuating in recent days and the euro has weakened because of concerns that Greece might default on its debt.

Rising commodity prices also helped energy and material stocks, pushing indexes higher. Commodities mostly climbed on hopes demand will jump as the economy continues to improve. Chevron Corp and ExxonMobil Corp both rose.

While the Dow's approach to 11,000 has been a big focus for many individual investors, a number of Wall Street analysts downplay its importance for professional money managers. The Dow has crossed the 11,000 level 34 times since first hitting it in May of 1999.

"Round numbers are always psychologically significant," but rarely do they represent a technical milestone such as an index breaking out of a recent trading range, said Uri Landesman, head of global growth at ING Investment Management in New York.

The Dow rose 70.28, or 0.6 per cent, to close at 10,997.35. The Standard & Poor's 500 index climbed 7.93, or 0.7 per cent, to 1,194.37. The Nasdaq composite index rose 17.24, or 0.7 per cent, to 2,454.05.