The Dow Jones industrial average surged Tuesday to a new all-time high as investors shrugged off the current partisan wrangling in Washington over the US budget and took the blue-chip index to its highest level since October 2007.
The Dow closed at 14,253.77, up nearly 126 points for the day, handily surpassing its previous record close of 14,164 and its intraday high of 14,198, also reached in 2007.
The recent bull run on the Dow has been attributed by analysts to a variety of factors including the Federal Reserve Board’s continuation of record low interest rates and signs that the US economy is on the path of a sustainable recovery and was beginning to come to terms with its debt and deficit woes.
Some pointed to China’s announcement that it planned to increase public spending and subsequent gains on European exchanges as one of the causes of Tuesday’s rise in the Dow.
They cautioned however that while the Dow represents some of the best-known US corporate brands among its 30 leading industrial stocks, the Dow index is a relatively narrow measure of US economic performance.
The Standard and Poor’s index of 500 stocks, a much broader measure, is still off the record high levels it hit prior to the 2008 economic collapse and the tech-heavy Nasdaq index, while trading higher recently, still remains well off its all-time closing high of 5,048 in March of 2000.