1 Reason the Dow Set New Records Today
It's official, folks: The Dow Jones Industrial Average (INDEX: ^DJI) skated by previous records to close at multiyear highs today. The index, comprised of 30 blue-chip stocks, closed at 12,862 for the day, eclipsing the high-water mark set in May 2008.
But the Dow wasn't alone -- the Nasdaq broke into territory not seen since the end of 2000.
An amazing 28 of the Dow's 30 components rode the wave of enthusiasm to close higher today, with 19 of them gaining 1% or more. You'd think with the tech-heavy Nasdaq hitting decade-plus highs that it'd be tech companies fueling all the enthusiasm today, but actually it was consumer goods and financials.
Bank of America (NYS: BAC) set the bar with a 5.2% run for the day. This just further distances them from their fellow Dow components and entrenches them as the top-performing Dow stock of 2012 so far. Of course, all those gains don't come risk-free: On the way to an incredible 41% YTD gain, the stock has wildly swung, with 3% gains and losses in each day.
Caterpillar (NYS: CAT) crushed fellow index components when it closed 3.3% higher for the day. The big news out of the industrials manufacturer today included the closure of a Canadian plant in a lockout dispute. A month into the dispute, Caterpillar decided to close the 670-person plant. This comes after the plant's workers agreed to cut wages in half, which would have greatly affected pension and wage expenses.
The big news
Utimately the news moving the market today was bigger than any one company. The unemployment level got hammered down to 8.3% today as the economy added a reported 243,000 jobs in January.
This greatly impacts cyclical companies like materials producer Alcoa (NYS: AA) and energy company Chevron (NYS: CVW) . No surprise, then, that Alcoa was the third-biggest Dow winner today, closing 3.3% higher for the day. Chevron also had a great run, putting up a 1.8% gain for the day.
Looking past one "up" day
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At the time this article was published Austin Smith owns no shares of the companies mentioned here. The Motley Fool owns shares of Bank of America. 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.
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