Surge Sends Dow Past 13,000 Mark

The Dow Jones industrial average shot up more than 100 points Wednesday to close above 13,000 for the first time. The markets seem to be reacting to unusually strong earnings reports from major companies and better-than-expected news on sales of durable goods.

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STEVE INSKEEP, host:

NPR's business news starts with the Dow over 13,000.

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INSKEEP: Better than expected, news about the economy pushed the stock market's best-known indicator to a record high yesterday. The Dow Jones industrial average jumped by triple digits to close at 13,089. Despite forecasts that the economy may be heading toward a major slowdown, the market has been on something of a tear.

And NPR's Jim Zarroli has more.

JIM ZARROLI: The major stock index has all hit multi-year highs yesterday but it was the Dow that generated the headlines. It rose 135 points or a little more than one percent of its value. It was only last October that the Dow hit 12,000 for the first time.

It fell sharply at the end of February but in recent weeks it's regained all that it lost. Ned Riley, chairman of Riley Asset Management, says investors have been encouraged by unusually strong earnings reports from major companies such as Boeing, Amazon and Colgate-Palmolive.

Mr. NED RILEY (Chairman and Chief Executive Officer, Riley Asset Management): Clearly, it's the earnings picture that has developed over the last couple of weeks is pushing investors back into the market.

ZARROLI: Stocks were also helped yesterday by a commerce department report saying durable goods orders were higher than expected last month. Riley says this combination of moderate economic growth and strong earnings coupled with relatively low inflation is just what investors are looking for.

Mr. RILEY: I can't see any better environment for stocks and I'm very optimistic we'll see 14,000 by the end of this year.

ZARROLI: But there are also potential pitfalls on the economy, such as the housing market that remains weak and continued high oil prices, either of which can drag down economic growth.

Jim Zarroli, NPR News, New York.

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