NEW YORK — Bust out the champagne! The Dow Jones industrial average topped 16,000 for the first time ever Monday, while the S&P 500 briefly surpassed 1,800.
The Dow rose slightly in late morning trading and is up more than 20% so far this year. The S&P 500 was flat but has soared more than 25% in 2013.
The Nasdaq is also on the verge of a milestone. The tech-heavy index was down a bit but is nearing 4,000, a level it hasn’t hit since September 2000 — just months after the tech market collapsed.
Experts say that this year’s roaring bull market is due largely to stimulative monetary policies from the Federal Reserve as well as decent corporate earnings.
Investors will be keeping a close eye on the Fed in particular during the coming months. Current Fed chairman Ben Bernanke, the architect of the central bank’s bond purchase program, will leave that role when his term expires at the end of January. Bernanke is likely to be replaced by Fed vice chair Janet Yellen, who just needs to be confirmed by the Senate.
Investors have been encouraged by comments from Yellen during her Senate confirmation hearing last week about how the Fed’s policies, particularly the $85-billion-per-month bond-buying program, can continue to help the market and economy.
But ultimately, Yellen is expected to scale back, or taper, the bond buying program at some point next year.
What’s moving: Boeing shares rose Monday after the aircraft maker said it sold more than $95 billion of its new 777X at the Dubai air show. Boeing said it was a record launch for a new aircraft and was far more than analysts had been forecasting. Boeing has been the biggest gainer in the Dow this year, soaring more than 85%.
Sony shares rose after the company said it sold more than 1 million units of its new PlayStation 4 gaming console in the first 24 hours since the game console went on sale early Friday. The game system is Sony’s first in seven years and is going head-to-head with Microsoft’s upcoming Xbox One this holiday season. Shares of Microsoft slipped.
Bitcoin price surges: While stocks continued to soar, so did Bitcoin. The price of the digital currency touched an all-time high above $600 earlier Monday, up almost 20% from Friday’s closing price of $528.32.
Since the start of October, the price of Bitcoin has more than quadrupled in value.
The latest surge has been fueled by the interest of new investors, especially those in China, who are becoming increasingly optimistic about the digital currency’s potential growth.
China unveils bold reform plan: Asian markets rallied too, with Chinese stocks jumping significantly higher after a new document from the government outlined important reform plans for the country.
The Shanghai Composite index and Hang Seng powered ahead by nearly 3%, with investors cheering the laundry list of social and economic reforms. Deutsche Bank chief economist Jun Ma called the reforms “by far the most profound reforms in a decade, if not decades, in terms of scope, depth, and impact.” The reforms also sparked enthusiasm in European markets.
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