Dow's Record Rally Sign of Good Things to Come?

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Wall Street saw a history making high, with the Dow Jones rising 126 points on Tuesday to close at 14,245. That tops the previous all-time high by more than 89 points.

It also doubled its record low, set almost exactly four years ago, gaining 118 percent since then.

"I love the buzz that this has created because this is telling mainstream investors something I've been trying to explain for over a year -- that the stock market is a place that you need to have your money," one trader said.

Analysts say the surge was brought on by a number of factors, from spending abroad and consumer confidence here at home to low interest rates and the recovering housing market.

But while the rebounding stocks are a positive sign for the economy, many wonder if it can last. Financial experts point to several signs that it can:

  • The economy is continuing to slowly grow.
  • Businesses are making money.
  • Interest rates and inflation are still very low.
  • There's still a great deal of money on the sidelines that has not gone back into the stock market yet.

But some analysts say the stock market isn't completely out of the woods yet.

"You don't' see the champagne bottle and the confetti coming down from the ceiling or balloons because there is still a very, very big disconnect between what the market is telling us and what the economy is telling us," Ken Polcari, a trader with O'Neil Securities Incorporated, said.

But analysts hope that this is the start of further economic recovery. For now, they believe the market will continue to soar.

Experts say a strong stock market also builds confidence among companies and gets them hiring, which will also aid in continued economic recovery.

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CBN News
Caitlin Burke and Charlene Israel

Caitlin Burke and Charlene Israel

CBN News

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