Stock market hits record highs as economy rebounds

ABC News’ Deirdre Bolton discusses what’s behind the record stock market numbers, and how the economy is being boosted by consumer spending and improving employment.
4:31 | 04/17/21

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Transcript for Stock market hits record highs as economy rebounds
And now to the economy back here at home and another record week on Wall Street the Dow Jones closing today at another record. High at 34200. And the S&P 500 also hit another record mark the fourth straight week of gains. Let's bring in ABC news economic correspondent Deirdre Bolton to discuss what's behind the rise today. If your many have commented on how the stock market is detached from main street and the real economy so how. Important are these stock market records and and what are they tell you about the state of the economy right now. And Judy is our market is important it's an indicator I agree that it is not the exact barometer for every single mainstream businesses but one of the reasons why we are seeing stocks at record highs. Is because of corporate America is beginning to show us all ambassadors. Its report cards we've had a lot of banks for example was earnings this week much better than expected. And so that's one of the reasons why we are seeing the stock market act these record highs. We lasted quite greatly about the economy which is a separate entity. And another reason why the stock is are so high is because the economy is really going on all cylinders we have had such a top twelve minds. And it seems like now we are finally turning the page so we got some data this week that was really encouraging. Showing that Americans are out and about they are spending in all kinds of businesses most economists saying the fact that the vaccine sites opening up. More and more people getting vaccinated means that more and more businesses are BER being able to open. And that is also helping at the job markets and even statistically. We had a data point this week Gigi which showed the few ways to number of Americans. Applying for unemployment benefits for the first time in thirteen months so all the way back. To march 20/20 so that is a really encouraging sign a caveat of course. Is that more than sixty million Americans are still looking for work I don't want to downplay that. I'm just trying to show statistic read that we are making a positive that hit it in the right direction so for all of these reasons. We are seeing that reflected in the stock market highs to issue. Yeah those unemployment numbers are really say a lot that stands out and yet the consumer spending that you elated to seems to be driven by those stimulus checks. Huge hole and huge hole a huge help exactly as intended so it's actually wonderful to see I can tell you the government tracks what we spend collectively. In thirteen different categories some months and months. And for the first time in a very long time all thirteen of these categories for march. We were actually spending more in all of I want to tell you about to stand out stack that at least I thought were particularly reassuring. So why is in retail sales and apparel I mean this was so crushed during the pandemic economy. Up 18% actually little bit stronger than 18% in March and also restaurant spending another area that was so cracks in the past twelve months. Americans spent more than 13% month on my for the month of march. These are the strongest advances for both of these categories since last June so. What we can say is the recovery is here now to what extent that continues. Is a larger question but for the moment I think most economists will tell you we have turned the page from the worst GU. So there's retail sales and spending and yet there's also a surge in investing in the past year what's driving that in where people putting their money. Well this is interesting because as we are talking about these amazing stock market teens and hitting new highs. Bear. Is also investor attention going into you alternative asset so we've been seeing a lot for example for their currencies it bitcoin we had queen bees go public this week. So there is some concern I think among investors cheered just traditionally and bask in stocks and bonds. Saying wow okay this is amazing that the market is hitting these new highs. But at what point does it become over strikes at what point does it become. People call it a bubble or frothy what are the terminology is so they're looking for new places to put their money. So we are seeing some of these alternative assets be bid as route to Egypt as long as the bubble doesn't burst thank you for your time director appreciate your insight. Thank you.

This transcript has been automatically generated and may not be 100% accurate.

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