When HSI can break the all-time high? I prefer a slower bull market…
U.S. companies are really strong…
Dow Sails Past 2007’s All-Time High, Nasdaq Hits Highest Since November 2000
Stocks held near session highs Tuesday, with the Dow Jones Industrial Average shooting up to its highest level ever, following an upbeat ISM non-manufacturing index and amid ongoing monetary support from the Federal Reserve.
(Read More: Dow Smashes Record: End of the ‘Lost Decade’?)
So far, the Dow is up nearly 9 percent in 2013, surpassing the 7.3 percent gain for all of 2012.
“The real risk to this market is to the downside because when [the market] turns, it’s going to turn hard and fast," said Gordon Charlop, trader at Rosenblatt Securities. “We’ve gotten up this high too quickly and it would be healthy if we had some sort of retracement now."
(Take Our Poll: Can the Rally Still Keep Going?)
|DJIA||Dow Jones Industrial Average||14265.92|| ||138.10||0.98%|
|S&P 500||S&P 500 Index||1540.26|| ||15.06||0.99%|
|NASDAQ||Nasdaq Composite Index||3222.52|| ||40.49||1.27%|
The Dow Jones Industrial Average soared nearly 150 points, led by Hewlett-Packard and United Technologies, spiking above its all-time high of 14,198.10 hit on October 9, 2007. The Dow Jones Transportation Average also touched a record high.
(Read More: Banks Left Behind in Dow’s Record Rally)
The S&P 500 and the Nasdaq also rallied 1 percent. The S&P 500 traded at a fresh 5-1/2 year high and is now less than 2 percent from hitting its record close. TheCBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, fell below 14.
All key S&P sectors were in positive territory, led by techs and industrials.
(Read More: Cramer: It’s Hard to Get Out of Stocks Now)
“The Wizard of the Fed, Ben [Bernanke], has done a great job propping up the market, but the question is how does the wizard move the pin from the balloon without blowing the whole thing up?" said Charlop. “This is getting out of balance and he’s got to figure out a way to justify the levels that we’ve gotten to and draw back on some of the stimulus."
On the economic front, the services sector expanded in February, according to the Institute for Supply Management’s non-manufacturing index. which rose to 56.0, exceeding expectations for 55.0. A reading above 50 indicates a sector expansion.
European shares were boosted by the news that euro zone finance ministers have struck an agreement to bail out Cyprus by the end of March, although they have yet to work out the details of the 17 billion euro ($22.1 billion) financial aid package.
Shares in mainland China rallied 2 percent as outgoing Chinese Premier Wen Jiabao set out a reform plan at the National People’s Congress in order to achieve a 2013 growth target of 7.5 percent. The Shanghai Composite tumbled to its lowest level in six weeks on Monday after the Chinese cabinet announced harsher-than-expected property curbs in China.
(Read More: Why China’s Property Market Is Getting Scary)
Qualcomm rose after the chipmaker said it is raising its quarterly dividend by 40 percent to 35 cents a share from 25 cents a share and announced a $5 billion stock buyback program.
Google edged higher after Jefferies boosted its price target on the search-engine giant to $1000 from $875 with a “buy" rating. The company hit an all-time high on Monday.
Netflix gained after RBC initiated coverage of the movie-streaming website with an “outperform" rating and a price target of $210.
(Read More: Big Changes in in Tech Since Last Dow Record)
JCPenney slumped to lead the S&P 500 laggards amid news Vornado Realty Trust is selling 10 million of the retailer’s shares via Deutsche Bank, sources told CNBC. Vornado currently has an approximately 8.5 percent stake in the retailer, or about 18.6 million shares.
The Senate Budget Committee is expected meet to discuss reducing the fiscal deficit by eliminating wasteful spending in the tax code.
House Speaker John Boehner said President Barack Obama and he had made no headway on a deal to avoid sequestration over the weekend. Meanwhile, House Republicans are expected to introduce a bill to extend government funding through September, to avoid a government shutdown at the end of the month.
While stocks so far have largely ignored sequester concerns, analysts say signs the cuts are beginning to impact the economy could eventually move markets.
Stephen King, chief global economist at HSBC, said that the U.S. was living in afantasy world" over the impact sequestration would have on growth.
“If you look at the projections from the Congressional Budget Office, they assume that growth goes back to between four to five percent in real terms between 2014 and 2018. Their numbers suggest that the U.S. will post the fastest rate of productivity growth of any decade in the last 50 or 60 years," King told CNBC Europe. “Even allowing for the fact that there’s some debt reduction, coming through sequestration, there’s still a degree of wishful thinking with regard to the economy which probably isn’t going to come true." (CNBC Explains: What Is Sequestration?)
Later, Richmond Federal Reserve President Jeffrey Lacker will take part in a panel discussion, “Help or Harm: Central Bank Monetary Policies at the Outer Limits," at the National Association for Business Economics Conference in Washington D.C. at 2 p.m. On Monday, Fed vice chair Janet Yellen said aggressive monetary stimulus is warranted since the economy continues to operate well below its full potential. (CNBC Explains: What Is the Federal Reserve?)
(Read More: Earnings Aside, Fed Is Still Main Market Player)
VeriFone is scheduled to report fourth quarter earnings after the closing bell.