Dow Jones Breaks Record High Set in 2007 - WLNS TV 6 Lansing - Jackson | Your Local News Leader

Dow Jones Breaks Record High Set in 2007

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JACKSON, Mich. (WLNS) - After a record-setting close Tuesday, stocks closed even higher Wednesday at 14,296. The Dow Jones jumped to an all-time high of 14,253, topping its previous record set in October 2007.

The Dow Jones Industrial average is made up of the stocks of 30 corporate giants in the American economy, with companies like Coca-Cola, Caterpillar and Microsoft. While it's a good indicator of how some aspects of the economy are performing, it's not the full story.

Investment Advisor Dan Machnik says the Dow is up for many reasons, one being that these companies are outperforming analysts' expectations. Their corporate earnings are high. The stocks of the nation's 500 largest companies, is an indicator that many investment advisors prefer to use.

Dan Machnik, managing partner at the investment firm Willis and Machnik in Jackson, said Washington policies also play a role in pushing the Dow up. Bond yields are historically low right now, forcing investors to look for other ways to generate income. They'll then buy stock in large companies that pay dividends, like the stocks in the Dow.

Whether you own stock in the market or not, Machnik says when the market goes up, so does consumer confidence, which means people spend money, driving economic growth.

"If we're confident that the economy's on the right track. If we're confident that we're going to have a job in six months, the likelihood that we're going to go out and spend money is far greater than if consumer confidence were low. In a way, the markets can have an impact on that," said Machnik.

Consumer confidence rang in last month higher than expected. More than two thirds of economic growth is attributed to consumer spending.

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