What Drove the Dow's Highest Close Since 2008

Before you go, we thought you'd like these...
Before you go close icon

The market's three major indexes were all up today, each hitting its highest closing value in quite some time:

 ChangeEnding ValueHighest Close Since...
Dow Jones Industrial Average (INDEX: ^DJI) +123.13 [0.96%]12,904.08May 2008
Nasdaq (INDEX: ^IXIC) +44.02 [1.51%]2,959.85December 2000
S&P 500 (INDEX: ^GSPC) +14.81 [1.10%]1,358.04May 2011

Big picture: The stock market has been reacting to rosier economic numbers here in the U.S.

Today's uptick was helped by the lowest initial weekly jobless claims in four years, some favorable regional manufacturing data, and last month's home construction exceeding expectations (up 10% year over year). In Europe, there is increasing hope of eurozone approval of a Greek debt-swap agreement with private bondholders to forestall a default. After-hours, the European Central Bank swapped its $65 billion in Greek bonds for new ones to protect itself (and the 17 eurozone central banks) from any losses to its own portfolio.  

The Dow
Looking to the 30 individual stocks that comprise the Dow, all but one (Kraft) gained today. The two biggest winners were Microsoft and Bank of America (NYS: BAC) , up 4.1% and 4.0%, respectively.

Microsoft continues a run that has seen it rise21% in 2012. There didn't seem to be much major news reported, but it saw the most trading activity today of any Nasdaq-listed stock.

Bank of America is more tied to investor impressions of the economy, so its big gain on an up day isn't as surprising. It has been the most actively traded stock in the market (read John Maxfield's explanation here) and today was another large-volume day. For the year, it's up 45.5%.  

Outside of the Dow, former Dow component GM (NYS: GM) blazed up 9% after reporting its eighth straight quarter of profitability and a record-breaking $7.6 billion earnings haul for 2011 as a whole.

As you put the daily news in perspective and hunt for long-term buys, check out our free report: "3 Stocks That Will Help You Retire Rich." Along with sharing three stock ideas, it'll help your game plan for retirement. Just click here to get access now -- it's free.

At the time this article was published Anand Chokkaveluowns shares of Bank of America,Microsoft, and GM. He also owns long-dated options in Bank of America. The Motley Fool owns shares of Bank of America and Microsoft.Motley Fool newsletter serviceshave recommended buying shares of General Motors and Microsoft; and creating a bull call spread position in Microsoft. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners