NEW YORK, March 29 -- Wall Street's blue-chip express barreled along as investors on the New York Stock Exchange drove the 103-year old Dow Jones industrial average over the 10,000 plateau. The blue-chip indicator stood at 10,006.78, up 184.54 points at the closing bell today. Experts say no inflation, a moderately growing economy, a fresh wave of corporate mega-deals, strong profit performances and a tame real- economy growth rate continue to be powerful forces for stocks. Analysts say Wall Street has been benefiting from very strong demand for oil, high technology and financial stocks, and blue-chip issues. 'It was only 27 years ago that the Dow swept past the 1,000 level for the first time,' said Gene Seagle, president of Tactic and Technics Consultants in Weston, Conn. The Dow jumped over the 8,000 level in July 1987 and over the 9,000 barrier for the first time in April 1998. The key average blasted through the 4,000 level back on Feb. 23, 1995, when it closed up 30.28 points at 4,003.33. The index surged through the 5,000 barrier just nine months later, when on Nov. 21, the blue-chip indicator surged 40.46 points to 5,023. 55. The average tested the 6,000 level on Oct. 14, 1996, jumping 40.62 points to 6,010.00, and it jumped through 7,000 on Feb. 13, 1997, rising 60.81 points to 7,022.44. The Dow industrial average measures prices of 30 issues listed on the New York Stock Exchange. It first appeared May 26, 1896, with 12 corporations, of which only General Electric Co. remains.
The Dow average was invented by Charles H. Dow, co-founder of Dow Jones & Co. and the first editor of the Wall Street Journal. He experimented with the idea for years. To compute the average, Dow added the prices of the stocks and divided by 12. On its first day, the average stood at 40.94. It began to fall from the outset until it reached its all-time low of 28.48 on Aug. 8, 1896. Historians generally date the Dow's 'real beginning' as Oct. 7, 1896, the day continuous publication of the average began in the Wall Street Journal. Twenty years later -- on Oct. 4, 1916 -- the average was expanded to 20 stocks. On Oct. 1, 1928, it again was expanded to 30 issues. Also on Oct. 1, 1928, a new method of computation was employed. To compensate for numerous stock splits, a divisor of 16.02 was used instead of the number of stocks in the average. The divisor has been adjusted numerous times over the years. The gauge is periodically updated and revised by the Journal's editors. The stock market as measured by the Dow historically been a precursor of a better economy. The Dow has tended to surge anywhere from six months to eight months ahead of a recovery. The Dow's largest single-day point decline was on Oct. 19, 1987, when the key average plunged 508.00 points, or 22.62 percent in value, to 1, 738.74. October 1987 was a bad year for the indicator, as the average also fell 156.83 points on Oct. 26, 108.35 points on Oct. 16, 95.46 points on Oct. 14 and 91.55 points on Oct. 6. ---
Copyright 1997 by United Press International. All rights reserved. ---
