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Dow, wow! Market tops 10,000 for the first time

SHARE Dow, wow! Market tops 10,000 for the first time

NEW YORK -- The Dow Jones industrial average broke through 10,000 Tuesday, a feat made possible by nearly a decade of steady economic expansion and the growing enthusiasm for technology, especially the Internet.

The Dow industrials cleared the milestone at 7:50 a.m. MST and climbed as high as 10,001.78, a gain of 43.01, before giving ground. It was up 8.05 at 9,966.82 at midday.As the record was broken, a roar exploded through the floor of the New York Stock Exchange. Traders cheered and raised their arms in celebration, and some held up both hands with their fingers spread to signify 10.

The revelry lasted only about 30 seconds before traders and clerks returned to work.

The average of 30 blue-chip stocks took almost a year to gain 1,000 points after passing 9,000 on April 6, 1998. The 1990s bull market was all but written off last summer and early autumn after Russia's economic crisis, then rebounded on a series of three interest rate cuts by the Federal Reserve.

The Dow got a lift Tuesday from an upbeat earnings forecast from Union Carbide, one of the Dow's components. Wall Street's best-known indicator also has been pumped up by its own momentum, including a spurt of more than 700 points in the past two weeks. By reaching five digits, the Dow is now up nearly 9 percent this year on top of an unprecedented four straight years of double-digit growth.

The march toward 10,000 started in the early 1990s when the U.S. economy began a period of remarkable growth combined with low inflation and interest rates that kept consumers spending and corporate profits rising. The rise of personal computers and technology improved productivity even as manufacturing jobs steadily declined.

The market got an additional boost in the past year through the explosion of enthusiasm for moneymaking on the Internet, as hundreds of companies added a "dot.com" after their names, expecting a big payoff by selling everything from Furby dolls to stocks on the World Wide Web.

And it was pumped up by a recent perception that the troubled economies of Asia and Brazil may be bottoming out.

"This is a phenomenal market," said Ralph Acampora, director of technical research, Prudential Securities. "It's not the level of 10,000; it's the quality of stocks . . . GE and Merck and American Express. If we're investing in blue-chip America, it can't be bad. You should be singing 'God Bless America.' "

But one investor said that while he was cheered by the Dow's performance, he wondered how far above 10,000 the bull market could climb and now is putting more money into conservative investments.

"It makes me a little more cautious because it's a hype number, a magic number, that everyone's expecting," said Andrew Jablonski, 42, a graphic designer from Yonkers, N.Y., as he emerged from a Fidelity Investments office on New York's Park Avenue.

"I think a lot of people will look closer, and this honeymoon mood will have to be checked with reality," he said.