By Kate Gibson and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks rose sharply Tuesday,
lifting the Dow Jones Industrial Average to its loftiest spot ever,
after a report illustrating continuing improvement in the service
sector.
The more than century-old blue-chip index rose above the
14,164.53 record finish hit on Oct. 9, 2007, ahead of the global
financial meltdown.
The market's four-year climb off the 2009 lows that followed has
Wall Street bidding farewell to losses that came with the financial
crisis, as monetary stimulus from the Federal Reserve and
corporate-profit expansion supported Wall Street's recovery.
"The good news is the market has put in a new high, and we're
actually at a better place than the last time we were at this
level," said Lazard Capital Markets strategist Art Hogan of October
2007.
The Dow industrials fell 34% in 2008 as the housing bubble burst
and the federal government moved to rescue the U.S. banking
system.
On Tuesday, the Dow industrials (DJI) were up 146.38 points, or
1%, at 14,274.20, after rising to 14,286.37, easily topping its
all-time intraday high of 14,198.10, set on October 11, 2007. See:
IBM led gains in Dow's return to record territory.
See commentary: What's the big deal about the 2007 highs?
The S&P 500 index (SPX) rose 16.34 points, or 1.1%, to
1,541.54, with technology leading gains among its 10 major industry
groups.
Shares of Qualcomm Inc. (QCOM) rose 1.8% after the computer-chip
maker raised its dividend by 40% and created a $5 billion
share-buyback program.
The Nasdaq Composite (RIXF) climbed 38.91 points, or 1.2%, to
3,220.91. See: Apple's not in the Dow, thank goodness.
For every stock that fell, almost six gained on the New York
Stock Exchange, where composite volume surpassed 1.3 billion as of
11:30 a.m. Eastern.
Equities extended their rally after the Institute for Supply
Management released its index of nonmanufacturing activity, which
climbed to 56% in February from 55.2% the month before. See: Index
of business conditions jumps to highest level in one year.
"It's a very solid reading that usually doesn't get much
attention," said Hogan .
American Apparel Inc. (APP) rallied 15% after the retailer
projected 2012 sales that beat estimates; J.C. Penney Co. (JCP)
shares fell 9.3% after a large shareholder sold a portion of its
holdings.
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