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Dow: Best winning streak since '55

Blue-chip gauge hits another record, capping best stretch of gains in 52 years; earnings, buyouts, factory orders all help.

By David Ellis and Alexandra Twin, CNNMoney.com staff writers

NEW YORK (CNNMoney.com) -- The Dow Jones industrial average hit another record high Wednesday, capping its longest winning stretch in almost 52 years as investors welcomed strong earnings, lower oil prices, media merger news and a strong reading on manufacturing.

The Dow (up 75.74 to 13,211.88, Charts) rose 0.6 percent to close at an all-time high for the fifth time in the last six sessions. The Dow also hit an intraday record high of 13,256.33 during the session before retreating near the close.

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The blue-chip indicator has now risen in 21 of the last 24 sessions for a gain of 7.4 percent. That's the best streak since the summer of 1955. Back then, the Dow climbed about 10 percent, rising in 22 of 25 sessions.

The tech-heavy Nasdaq composite (up 26.31 to 2,557.84, Charts) gained over 1 percent and closed at a fresh 6-year high. The broader S&P 500 (up 9.62 to 1,495.92, Charts) index rose nearly 0.7 percent and ended at a fresh 6-1/2 year high.

Thursday morning brings earnings from General Motors, the April ISM services sector report and the first-quarter reading on productivity.

After cheering News Corp's $5 billion bid for Dow Jones on Tuesday, Wall Street learned of another potential media deal Wednesday from Cablevision (up $3.23 to $35.90, Charts, Fortune 500). The No. 5 cable operator agreed to be taken private for $10.6 billion by the family that already owns a controlling stake in the company, sending shares up nearly 10 percent.

A spate of mergers and other deal news has helped to lift the stock market this year, as investors have hailed the signs of corporate confidence. The increased wave of stock buybacks has added to such bets. But the most recent leg of the rally has also been driven by the surprisingly strong earnings.

"There's no question that the earnings have been much better than what analysts were expecting," said Charles Smith, chief investment officer at Fort Pitt Capital Group. "And that's been driving the advance."

Smith noted that at the end of last quarter, analysts were expecting earnings growth of just over 3 percent, whereas now, growth is on track to rise nearly triple that amount.

With 74 percent of the S&P 500 having reported results, earnings are currently on track to have grown 7.9 percent from a year ago, according to the latest Thomson Financial estimates. That's a blended number, including reported and forecast earnings, with the final number likely apt to show growth of as much as 9 percent.

Also helping stocks Wednesday: a stronger-than-expected reading on March factory orders.

"It probably lessened recession fears more than anything else," said John Lonski, chief economist for Moody's. "It [factory orders] should supply a boost to economy in the months ahead."

Wall Street also weighed a weaker-than-expected reading on private sector employment, as the ADP National Employment reported that the private sector added 64,000 jobs in April, short of forecasts. The reading suggests that Friday's April jobs report could show weaker payroll growth than currently forecast.

Gains were broad based, with 25 out of 30 Dow issues rising, led by American Express (up $1.42 to $62.74, Charts, Fortune 500), DuPont (up $1.18 to $50.54, Charts, Fortune 500), General Motors (up $1.14 to $32.44, Charts, Fortune 500) and Microsoft (up $0.21 to $30.61, Charts, Fortune 500).

Intel (up $0.13 to $21.93, Charts, Fortune 500), Cisco (up $0.83 to $27.67, Charts, Fortune 500) and Yahoo (up $0.39 to $28.12, Charts, Fortune 500) were among the heavily-traded Nasdaq stocks rising.

Dow Jones (down $0.20 to $56.00, Charts) shares inched lower after the company that controls the media behemoth indicated it would not approve News Corp (up $0.44 to $23.43, Charts, Fortune 500)'s proposed takeover, opening the door to other bidders.

In earnings news, CNNMoney.com parent Time Warner (up $0.35 to $20.94, Charts, Fortune 500) reported earnings that beat estimates on sales that met estimates.

MasterCard (up $11.50 to $126.35, Charts) reported higher quarterly sales and earnings that topped forecasts, sending shares higher.

Shares of the fast-food firms Yum Brands Inc. (Charts) and Chipotle Mexican Grill (up $11.83 to $78.09, Charts) soared after reporting better-than-expected results late Tuesday.

Transocean (up $2.94 to $89.21, Charts), which operates petroleum drilling rigs, reported higher quarterly sales and earnings that topped estimates.

Nortel Networks (up $2.05 to $25.12, Charts) jumped after the telecom gear maker said late Tuesday that it expects first-quarter revenue in a range that could top analysts' forecasts.

Market breadth was positive. On the New York Stock Exchange, winners beat losers about 3 to 1 on volume of 1.68 billion shares. On the Nasdaq, advancers topped decliners almost 2 to 1 on volume of 2.13 billion shares.

Treasury prices slipped, lifting the yield on the 10-year note to about 4.64 percent from around 4.63 percent late Tuesday. Treasury prices and yields move in opposite directions.

In bond market news, the government said Wednesday that it is discontinuing the sales of three-year treasury notes, due to what it said was an improving budget deficit.

In currency trading, the dollar eased against the euro and gained versus the yen.

U.S. light crude oil for June delivery fell 72 cents to settle at $63.68 a barrel on the New York Mercantile Exchange, after the government said supplies of gasoline fell and crude oil inventories climbed.

COMEX gold for June delivery fell $2.20 to settle at $675.10 an ounce. Top of page