The Dow has closed above the 10,000 mark for the first time his year and the first time since since Oct. 3, 2008. The index is still 30% below its peak but it is still an upbeat feeling for investors to see the Dow climb from below 7,000 to back above 10,000.
Like a magnet, Dow 10,000 has emerged as a financial force of nature that attracts and repels stock investors during thrilling bouts of profit-induced euphoria and depressing journeys into money-losing despair. The Dow Jones industrials may climb above 14,000. Perform a 15,000 tease. Or plunge to 6500. But ever since its maiden voyage to 10,000 on March 29, 1999, the 113-year-old stock index with the blue-chip pedigree always seems to end up back at the same place: Dow 10,000.
The market closed Wednesday with the Dow up 145 points to 10,016, its first time above 10,000 in a year. The fact that the Dow, a financial icon with a global following, is again north of that key level is significant because seven months ago it was feeling the full brunt of the financial crisis and trading below 7000 – a 12-year low and 53.8% off its October 2007 record of 14,164.53.
The big question is "What Now?" Investors are hoping the Dow stays about the 10,000 mark but it is certainly possible that it could slip right back below 10,000. Dennis Berman talked to Fox Business about what the market milestone means for investors. As Berman says the number looks good from 6,500 but not so good from 14,000. Take a look:
The Dow soared to a new high this week. It climbed 377 points, or 4%, for the week to close at 9864.94.
The Dow climbed four of five sessions this week and ended up 4% over that period, snapping a two-week losing skid.
The market's gains this week have been driven by a promising start to the earnings season from Alcoa, whose shares gained 10% since Monday, and a move by the Reserve Bank of Australia to tighten its key interest rate. Many investors interpreted that move as a sign that the global economy is returning to normalcy following last year's meltdown.
"Much of the earnings we are going to see will depend on the global economy," said Jordan Smyth, a managing director for Edgemoor Investment Advisors. "It seems everyone now expects earnings will continue to exceed expectations and we'll be looking for confirmation that businesses are seeing what we think we're seeing in the economy."
If the Dow climbs to 10,000 that still leaves the index around 30% down from its high point. Even so, many investors will be relieved to see that number again. The stock market seems to indicate the economy is out of the woods but there are still troubling indicators out there in housing, retail and unemployment.
