Apple powered the Dow Jones industrial average past 22,000 for the first time yesterday as shares in America’s blue chip companies continued to rally despite political chaos in Washington.
Shares in Apple hit a record high yesterday after the iPhone maker beat Wall Street expectations with its quarterly results on Tuesday evening, helping the Dow to close 52.32 points higher last night at 22,016.24.
The index of 30 of America’s largest companies has climbed by 11.4 per cent this year thanks in large part to two successive quarters of impressive financial results. Dow companies have also been propped up by a corresponding decline in the value of the dollar, which has boosted income from exports.
The Dow passed the 22,000-point milestone a month and a day after it breached the 21,000 mark and little more than six months after it broke through 20,000.
Neil Wilson, chief market analyst at ETX Capital, said: “It’s not just Apple. Earnings are delivering across the board for US equities. Whatever is happening in Washington is not bothering the stock market. It’s indicative of a bull market speeding to a top. But August is usually not a great month for stocks, so there is caution about how long this can be sustained beyond earnings season euphoria.”
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An unexpected revival for the iPad and stronger than expected iPhone sales helped Apple to beat analysts’ forecasts comfortably with its third quarter results. Shares climbed by 4.7 per cent to $157.14 in New York yesterday.
However, it is Boeing that has fuelled most of the Dow’s gains this year, with a 54 per cent jump in its shares accounting for about 600 points of the 2,252-point gain. Shares in the aircraft maker and defence contractor rose by 22.6 per cent in July in their best month since October 1982.
After Apple, McDonald’s was the best performer on the Dow yesterday, gaining 1.7 per cent, followed by United Technologies, up by 1.2 per cent, and 3M, which rose by 1.1 per cent. Walt Disney dragged the index down, losing 1.8 per cent, as did Verizon, which shed 1.4 per cent. Nearly 330 million shares in Dow companies were traded, above the recent daily average of 298 million.
The S&P 500 was flat on the day at 2,477.47 while the tech-focused Nasdaq index was unchanged at 6,362.65.
It took the Dow only 24 trading sessions to pass 21,000 on March 1 after breaking through 20,000 on January 25. Growth then stalled as it became clear that President Trump’s plans to cut taxes and spend heavily on infrastructure would be delayed because of disagreement between Republicans over how to replace the Obama administration’s healthcare legislation.
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The dollar has suffered its worst run in six years because of the deadlock in Congress and chaos in the White House, where a string of senior administration staff have departed in recent weeks at the behest of Mr Trump. The greenback sank to a 27-month low yesterday before making up some of its lost ground in late trading.