The Dow Jones industrial average closed above 20,000 on Wednesday for the first time ever, blowing past the historic benchmark on optimism around President Donald Trump’s pro-growth policies.
Traders cheered from the floor of the New York Stock Exchange as the big-company index finished the day at 20,068.10, up a whopping 155.80 points from the previous day’s close.
The blue chips had ripped past the 20,000 mark right out of the gate as Wednesday’s boffo session began at 9:30 a.m. eastern time, and never gave back their ground as President Trump acted on campaign promises to loosen regulation on Wall Street and unleash infrastructure spending.
Among the notable gainers were Boeing, which gave an upbeat forecast on plane sales as it reported strong earnings; and Caterpillar, whose shares surged on speculation about a coming surge in construction activity.
“Great! #Dow20K” Trump tweeted early Wednesday before affirming plans later in the day to build a wall on the Mexican border.
The rally in the Dow — which had stalled in recent weeks after peaking at 19,999.63 on Jan 6. — was reignited this week by Trump’s signing of numerous executive orders since his inauguration on Friday, including the go-ahead to move forward with the construction of two controversial oil pipelines.
Since Election Day alone, the Dow has risen more than 9 percent, or nearly 1,800 points.
But the Trump rally had been sputtering of late as investors sought clarity on his growth initiatives, with some fretting that his protectionist stance toward trade with China and Mexico could eventually tank the economy.
Analysts may have been incorrect in focusing on specific Trump policies instead of looking at the big picture, Bruce Bittle, Chief Investment Strategist at RW Baird, told The Post.
“The market is looking at this from a macro perspective — we’re moving from an administration that was anti-business to one that is pro-business,” Bittle said.
Lofted by a 4-percent rise in fourth quarter 2016 earnings, Bittle predicts that the 20,000 level will be the new support level for the Dow.
The rally occurred “even before an easing of tax regulations and other anti-business regulations actually happened,” he said.
The S&P 500 and the Nasdaq Composite also hit fresh, all-time highs early Wednesday after closing at record levels on Tuesday as the post-election rally roared back to life.
Trump this week also pushed chief executives of the Big Three US automakers to create jobs by building more plants in the United States. Shares of Ford, General Motors and Fiat Chrysler were all up in early trading.
The dollar, however, dropped to a near seven-week low on Wednesday of 99.84 as concerns about Trump’s protectionism stance on trade lingered.
With Reuters
