The US stockmarket has hit a new record high, with the Dow Jones Industrial Average breaking through 9,500 for the first time.
The Dow closed last night up 234.30 points at 9,545.49, a gain of 2.5 per cent on the day. It was already in record territory earlier in the day when it passed 9,400. The previous closing high was just over 9,374, reached on November 23rd. Enthusiasm for semiconductor and Internet shares extended the Nasdaq composite's record-breaking run, with the technology-dominated index closing yesterday up 3 per cent at 2,320.62.
Major stocks such as IBM and Microsoft led the market higher. Strong gains were also recorded in the telecommunications sector as UK firm Vodafone's bid for US mobile operator, Airtouch boosted the talk of merger and acquisition activity which has been behind much of the recent gains.
However, some analysts sounded a note of caution. Mr Arthur Hogan, chief market analyst at Jeffries & Co in Boston, said: "This is a completely liquidity-driven marketplace that's diverged from earnings fundamentals.
"January is the time when everyone's sitting on a pile of cash and it will take a huge earnings warning from the likes of General Electric or Microsoft to stop people in their tracks."
Meanwhile, Mr Barto Biggs, chief global strategist with Morgan Stanley Dean Witter, told Reuters that he expects a fall in the US market sometime this year, which could take it down 20 to 30 per cent from current levels.
