Dow keeps pushing toward 10,000 on upbeat economic news

NEW YORK -- After watching the stock market fall off a cliff in early March, not many on Wall Street thought the battered Dow, which sank to 6547, had a chance to get back to its high of 14,165 — or even Dow 10,000 — any time soon.

But with the Dow Jones industrials up eight of the past nine sessions and just a tad more than 200 points shy of the 10,000 milestone, traders might soon have to break out their 10-year-old "Dow 10,000" rally caps — despite the Dow having been nearly 3,250 points lower six months ago.

"Oh, boy, we're getting close," says veteran money manager Hugh Johnson, chief investment officer at Johnson Illington Advisors. And if he soon has to dust off the Dow 10,000 cap that traders put on to celebrate the Dow's first close above the magic number on March 29, 1999?

"That would be the biggest surprise of all," he says.

The market has been surprising a lot of people. Stocks keep rising, despite repeated calls from skeptics that the rally is a short-lived megabounce fueled by government cash and by hope that will fizzle under the weight of an indebted consumer and still-fragile economy.

But the Dow's 50% rise from its March 9 low of 6547 to 9792 after Wednesday's 108-point rally is proof that the market is in an honest-to-goodness bull market until proved otherwise, Johnson says.

Bears stress that stocks are overdue for a pullback, and that the Dow is still 31% off its all-time high and at levels first hit more than a decade ago, so there's not much to cheer.

Stocks have been rising on continued signs that the economy is emerging from recession. The latest bout of economic data to confirm the healing came Wednesday, when a home builders' group reported that its key sentiment index rose in September for the third month in a row.

Bolstering the recovery thesis was a report showing that industrial production rose more than expected last month. Tuesday, data on August retail sales showed a stronger-than-expected 2.7% rise.