The Dow Closes Above 15,000

by Marilou Long on May 8, 2013

in equity market

From Ed Yardeni’s Morning Briefing today:

Dow Theoreticians insist that the stock market averages for the industrial and transportation companies should confirm one another. In a bull market, the Dow Jones Industrials Average (DJIA) and the Dow Jones Transportation Average (DJTA) should both be ascending. In a bear market, they should both be descending. The practitioners of this theory get very jittery if the two indexes diverge or if one of them lags significantly behind the other. So for example, if the DJIA is making new highs and the DJTA is not, or is going the other way, that makes them bearish on the overall market. That’s what happened in early April. 

But now, all is well with the world again. The bulls are in charge again now that the DJIA and the DJTA are both happily charging together to new record highs (Fig. 1). I’m happy. How about you? The S&P 500 Industrials Composite–which is the S&P 500 excluding Financials, Transports, and Utilities–and the S&P 500 Transportation Composite are also prancing along together to new record highs (Fig. 2).

 

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