DOW - Stocks End at New Multi-Year Highs

Dow

11,722.89

+31.71

+0.27%

By: Abby Schultz, JeeYeon Park

Stocks closed at new multi-year highs Wednesday as investors cheered a handful of positive economic reports about jobs and service sector growth, and commodities turned higher.

The Dow Jones Industrial Average rose 31.71 points, or 0.3 percent, to close at 11,722.89, the highest close for the index since Aug. 11, 2008. The blue-chip index had eked out a new high in the previous session even a broad range of commodities came under pressure.


The S&P 500 rose 6.36 points, or 0.5 percent, to close at 1,276.56, the broad index's highest close since Sept. 2, 2008, while the Nasdaq gained 20.95 points, or 0.8 percent, to close at 2,702.20, the tech-focused index's highest close since Dec. 26, 2007.

The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell to 17.

Most key S&P sectors advanced, led by financials, consumer discretionary and telecom.

"This market wants to take a breather, but it is literally getting barraged daily by, dog-gone it, good news," said James Paulsen, chief investment strategist at Wells Capital Management.

The same appears to be true for commodities, Paulsen said, noting that a 1 percent gain in the trade-weighted value of the dollar [.DXY 80.275 0.83 (+1.04%) ] would typically send the Reuters-Jefferies Commodities Research Bureau Index [.CRB 329.2 1.47 (+0.45%) ] down, but instead the CRB was up Wednesday.

"It's a testament to how much stronger real growth is," Paulsen said.

Among commodities, copper, often seen as a bellwether for economic activity because of its multiple uses, rebounded after trading off on Tuesday. Gold prices fell near $1,373 an ounce.

Oil prices reversed earlier losses, and closed above $90 a barrel after a government report showed that inventories fell by about 4.2 million barrels. Earlier this week, the API, an industry group, reported a 7.5 million barrel drop in crude inventories for the week ended Dec. 31.

The markets started the day in the a slump, following a downturn overseas, as international investors weighed the continuing concerns about economic growth expressed by Federal Reserve officials in their December policy-setting meeting, as well as sliding commodity prices, particularly in industrial metals, said Kevin Kruszenski, head of listed trading at KeyBanc Capital Markets in Cleveland.

"The market has been following copper and other industrial metals, so the market started lower," Kruszenski said. But with good economic news on the job front, he said, "I wouldn't be surprised to see the market up on the day."