The Dow Jones industrial average today closed at a record high, 11,727.66, up 57.31, surpassing the previous record close of 11,722.98, set on Jan. 14, 2000. Today's closing numbers are preliminary.
Market observers said a combination of falling gas prices, the expectation of double-digit earnings gains at many large companies and an expectation among some that the Federal Reserve might soon begin lowering interest rates is all contributing to what is expected to be a steady climb in the DJIA.
"I think we will still continue to trend higher, and a lot of it is due to quality, large-cap stocks outperforming," said Nanette Buziak, senior vice president and head of equities trading at ING Investment Management.
Gary Schlossberg, senior economist at Wells Capital Management, said it appears that forces affecting the market are moving toward a sort of homeostasis.
"The market is really looking for that holy grail and it seems they have found it," Mr. Schlossberg said. "There's optimism on the profit outlook, and you need a growth rate strong enough to support that, but not too strong so the Fed can cut interest rates. It's a fine line and the market is having it both ways.
"I think the market is looking for that fine balance of moderate growth, but strong enough to support a strong rate of earnings growth," he said.