The Dow Jones industrial average closed above 13,000 for the first time since 2008, capping a remarkable run-up in stocks that has coincided with a revival of consumer confidence to levels not seen since well before the econ0mic downturn began.
The index, which is comprised of 30 large companies, is a closely-watched barometer of the stock market. The Dow has risen 6.74 percent this year after ending nearly even for all of 2011. The average closed at 13,005.12, up 23.61 points for the day.
Despite record gas prices and ho-hum economic news, consumer confidence rose to 70.8, up more than 9 points since January 2012.
“Consumer Confidence, which had declined last month, posted a sizable improvement in February. The Index is now close to levels last seen a year ago,” Lynn Franco, Director of The Conference Board Consumer Research Center said today in a statement.
“Consumers are considerably less pessimistic about current business and labor market conditions than they were in January. And, despite further increases in gas prices, they are more optimistic about the short-term outlook for the economy, job prospects, and their financial situation, ” said Franco.
It’s been a tough barrier to break. Last week, the Dow managed to skate above 13,000 several times but was unable to close above the mark. On Monday, the Dow was close to topping 13,000 but sagged and closed at 12,981.51.
The last time the closed above 13,000 was on May 19, 2008, four months before the fall of Lehman Brothers investment bank and the worst of the financial crisis, according to the Associated Press.
The first time the Dow hit 13,000 was in April 2007. The index then rose until hitting an all-time high of 14,164.53 in October 2007, just a couple of months before the official start of the crippling recession.
As the economy deteriorated the Dow wiped out more than half of it value, hitting a low of 6,547.05 in March 2009.