Dow Passes 13,000

New York (CBS/AP) - The Dow Jones industrial average shot past 13,000 for the first time Wednesday, powered by growing evidence of a strong corporate America: rising earnings and better-than-expected economic data.

The stock market's best-known indicator surged past its latest milestone shortly after the opening of trading, and continued rising to 13,036.99 before retracing some of its steps.

"I think we can expect continued progress, but I'm not sure how swift it will be," Michael Farr, chief investment officer at Farr, Miller & Washington, told CBS News.

After the first hour of trading, the Dow dipped below 13,000.

The Dow climbed to its latest milestone as many of the country's biggest companies surpassed analysts' first-quarter earnings projections. Among those beating forecasts Wednesday: soft drink maker PepsiCo Inc., materials manufacturer Corning Inc., consumer products company Colgate-Palmolive Co., and Dow component Boeing Co.

Wall Street also got a boost from the Commerce Department's report of better-than-expected durable goods orders last month, reassuring investors that demand for U.S. products remains strong, lending support to the economy.

It took the Dow just 129 trading days, since Oct. 18, to make the trek from 12,000 to 13,000, far less than the 7 1/2 years that the blue chips took to go from 11,000 to 12,000. But the swiftness of this latest trip does recall the days of the dot-com boom when the major indexes were soaring and it took the Dow a mere 24 days to barrel from 10,000 to 11,000.

In the first half-hour of trading, the Dow went up 53.79, or 0.42 percent, at 13,007.73.

The broader Standard & Poor's 500 index was up 6.83, or 0.46 percent, at 1,487.24, while the technology-dominated Nasdaq composite index was up 7.50, or 0.30, at 2,532.04.

The Dow was the first of the major indexes to recover from the stock market's prolonged slump in the early part of the decade. The S&P 500 has yet to reach its closing peak of 1,527.46, reached in March 2000, and no one expects the Nasdaq to reach its high of 5,048.62, also reached in March 2000.

Still, the Dow's latest achievement did not come without setbacks and volatility — the index lost 416 points in a single session, on Feb. 27, amid fears that the U.S. economy would fall into recession and that China's economy would slow as well. And Wall Street has had periodic shudders over signs that inflation might be getting out of hand — a trend that would lead the Federal Reserve to resume interest rate hikes — and over data that showed continuing weakness in the housing market.

Just two weeks ago, the Dow fell nearly 90 points after minutes from the last Fed meeting showed the central bank's level of concern about inflation.

The technology-dominated Nasdaq was lifted Wednesday by Amazon.com, which reported late Tuesday that first-quarter profit more than doubled, besting analyst estimates. The Web retailer also boosted its revenue outlook for the year, reassuring investors that the technology sector has the potential to keep posting profits.

Dow component Boeing Co. also reported better-than-expected results early Wednesday, after its stock reached an all-time high Tuesday when Virgin Atlantic and Air Canada chose the plane manufacturer's 787 Dreamliner over a rival model.

So far, 19 of the 30 Dow components have reported earnings, and 13 have exceeded expectations. The results buoyed the blue-chip index to three record closes last week, and new intraday trading highs this week.

Surprisingly strong earnings data have pushed the Dow past 13,000, but investors still face more economic reports that could derail the upward trend if they indicate the economy is slowing too quickly. Later Wednesday, the Commerce Department reports on new home sales, and the market is predicting that more new homes were sold in March than in February.

Investors will also be examining the Federal Reserve's Beige Book on economic activity in various U.S. regions.

Bonds slipped on the positive durable goods data, with the yield on the benchmark 10-year Treasury note rising to 4.64 percent from 4.62 percent late Tuesday.

Gold rose, while the dollar approached a record low against the euro.

Crude oil prices rose 27 cents to $64.85 a barrel in electronic premarket trading on the New York Mercantile Exchange.

Copyright 2007 CBS Interactive Inc. All Rights Reserved. The Associated Press contributed to this report.


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