News / USA

Key US Stock Index Tops All-time High

Traders work on the floor of the New York Stock Exchange March 5, 2013. The Dow surged to a new record on Tuesday, breaking through levels last seen in 2007 as investors extended 2013's rally. Traders work on the floor of the New York Stock Exchange March 5, 2013. The Dow surged to a new record on Tuesday, breaking through levels last seen in 2007 as investors extended 2013's rally.
x
Traders work on the floor of the New York Stock Exchange March 5, 2013. The Dow surged to a new record on Tuesday, breaking through levels last seen in 2007 as investors extended 2013's rally.
Traders work on the floor of the New York Stock Exchange March 5, 2013. The Dow surged to a new record on Tuesday, breaking through levels last seen in 2007 as investors extended 2013's rally.
TEXT SIZE - +
VOA News
The most prominent U.S. stock index, the Dow Jones Industrial Average, surged to an all-time high on Tuesday.

Within minutes of the opening bell at the New York Stock Exchange, the Dow's composite of 30 key stocks jumped to 14,254, surpassing the previous closing high of 14,164 recorded on October 9, 2007. That high-water mark occurred well before the U.S. and world economies plunged into the depths of a recession in 2008 and 2009, and stocks fell in lockstep.

Even now, the surge in the Dow comes as a contradiction to the overall state of the U.S. economy. The country's unemployment rate is still stuck at a historically high figure of 7.9 percent, with more than 12 million workers unemployed. And the country's economic advance has slowed markedly, up just one-tenth of a percentage point in the last three months of 2012.

In addition, U.S. President Barack Obama, the Democrat starting his second term, and his Republican opponents in Congress are locked in a long-running standoff over government spending and tax issues.

Just last Friday, $85 billion in mandated government spending cuts took effect, with  Obama and Republican lawmakers now sparring over the effects of the cuts on the economy and the U.S. labor market.

But James Glassman, the senior economist at the big JPMorgan Chase bank, said investors see favorable trends in the U.S. economy, the world's largest.

“The stock market reflects the value of our companies, and the value of our companies reflects what people think lies ahead. And what the market’s been telling us for a while, and the reason it’s continuing to rise, is that the news on the economy continues to grow better, is that we continue to see an economy that, while there was a lot damage on the recession, it’s recovering, as it usually does, and the news we’re getting is showing you that for all the worry that people had about political uncertainty, and the fiscal cliff and the sequestration, what the market sees in the news is the economy is doing reasonably well, and meanwhile, companies are extraordinarily profitable,” Glassman said.

Patrick Socci, the dean of the Hofstra University business school in New York, told VOA the fact that the U.S. housing market has improved and that the country's central bank, the Federal Reserve, continues to pump $40 billion a month into the economy have helped buoy the stock market.

Socci said investors are overlooking negative aspects of the U.S. economy.

“I think what’s happened is that people have become desensitized or numb to certain realities. For example, up until the last few years any unemployment above 5 percent was considered absolutely unacceptable and now we’re close to 8 percent and it’s been there for quite a while. And I think people just get numb to it,” Socci said.

The Dow index includes some of the best known U.S. companies, with such household names as the world's largest energy company, Exxon Mobil, the huge retailing giant Wal-Mart, and filmmaker Walt Disney. While other broad-based U.S. indexes, such as the Standard & Poor's 500, include the stocks of many more companies, the Dow has over decades come to symbolize the long-term success of American capitalism.

You May Like

Abuja Blast Impacts Lives, Livelihoods

Officials say they are looking at ways to help bombing victims and boosting security More

Cambodia Technology Adviser Criticizes Cybercrime Draft Law

Phu Leewood says current criminal code can be used to prosecute offenders and that there is no need for a separate law More

Photogallery A Year Later, Boston Remembers Deadly Marathon Bombings

City pauses to honor victims and salute emergency workers who came to their assistance in frantic moments after blasts More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Google Buys Drone Companyi
|| 0:00:00
...
 
🔇
X
George Putic
April 15, 2014
In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
Video

Video Ray Bonneville Sings the Blues and More on New CD

Singer/songwriter Ray Bonneville has released a new CD called “Easy Gone” with music that reflects his musical and personal journey from French-speaking Canada to his current home in Austin,Texas. The eclectic artist’s fan base extends from Texas to various parts of North America and Europe. VOA’s Greg Flakus reports from Austin.
Video

Video Millions Labor in Pakistan's Informal Economy

The World Bank says that in Pakistan, roughly 70 percent work in the so-called informal sector, a part of the economy that is unregulated and untaxed. VOA's Sharon Behn reports from Islamabad on how the informal sector impact's the Pakistani economy.
Video

Video Passover Celebrates Liberation from Bondage

Jewish people around the world are celebrating Passover, a commemoration of their liberation from slavery in Egypt more than 3,300 years ago. According to scripture, God helped the Jews, led by Moses, escape bondage in Egypt and cross the Red Sea into the desert. Zlatica Hoke reports that the story of the Jewish Exodus resonates with other people trying to escape slave-like conditions.
Video

Video Police Pursue Hate Crime Charges Against Kansas Shooting Suspect

Prosecutors are sifting through the evidence in the wake of Sunday’s shootings in a suburb of Kansas City, Missouri that left three people dead. A suspect in the shootings taken into custody is a white supremacist. As VOA’s Kane Farabaugh reports, he was well-known to law enforcement agencies and human rights groups alike.
Video

Video In Eastern Ukraine, Pro-unity Activists Emerge from Shadows

Amid the pro-Russian uprisings in eastern Ukraine, there is a large body of activists who support Ukrainian unity and reject Russian intervention. Their activities have remained largely underground, but they are preparing to take on their pro-Moscow opponents, as Henry Ridgwell reports from the eastern city of Donetsk.
Video

Video Basket Maker’s Skills Have World Reach

A prestigious craft show in the U.S. capital offers one-of-a-kind creations by more than 120 artists working in a variety of media. As VOA’s Julie Taboh reports from Washington, one artist lucky enough to be selected says sharing her skills with women overseas is just as significant.
Video

Video UN Report Urges Speedier Action to Avoid Climate Disaster

A new United Nations report says the world must switch from fossil fuels to cleaner energy sources to control the effects of climate change. The Intergovernmental Panel on Climate Change released the report (Sunday) following a meeting of scientists and government representatives in Berlin. The comprehensive review follows two recent IPCC reports that detail the certainty of climate change, its impacts and in this most recent report what to do about it. VOA’s Rosanne Skirble has the details.
AppleAndroid