The Dow Jones Industrial Average rose by more than 22 points to close at a record 1209.46 today as the stock market continued its unprecedented surge, propelled by petroleum and computer stocks.
It was the first time that the weighted average of 30 blue-chip stocks broke the 1,200 barrier. Twenty-seven of the stocks that make up the average rose and only one declined.
"I think anybody that watched the market today was amazed that it didn't give up any ground," said Michael Metz, an analyst with Oppenheimer & Co. Inc. Metz said suggestions of higher oil prices, several strong quarterly profit reports and gains in popular technology stocks stimulated the market to continue its seven-month-long string of record-breaking gains.
The Dow industrials were off by just over eight points Monday, and many stock analysts have predicted that stocks might begin to turn downward over the past two months. But Metz, for one, believes that the long-awaited correction is unlikely at this point, and today's big runup may support his view.
"You get serious corrections when you get disappointed expectations or people run out of money," Metz said. "You still have extremely high liquidity, and I don't think people are expecting big things from the economy."
The Dow average, the most closely watched barometer of stock market activity, picked up almost 25 points last week, and has set seven new highs in the last 10 trading sessions.
In addition to the sharp rise in the industrial average, 1,071 stocks on the New York Exchange rose and 545 declined. The New York Stock Exchange composite index was up 1.54 points to 92.83, as volume there rose from 90.1 million Monday to 97.25 million today. The average price per share was up 61 cents.
Fueled by heavy late trading, the market's sharp and sudden move surprised analysts, many of whom had expected a steep third-quarter profits drop at Digital Equipment Corp. to trigger an extended pullback in technology stocks. But the announcement that Commodore International's profits had more than doubled in the third quarter propelled its stock up by 3 1/8 to close at 88 3/4.
Although Digital's stock closed at 115 3/4, down 2 3/8 after a 2 1/8-point drop Monday, other technology stocks recovered today, paced by International Business Machines Corp., which rose by 2 3/4 to close at 117, and American Telephone & Telegraph which gained 1 5/8 to 67 1/2.