Post-election rally pushes Dow to 20K for first time in history

The Dow was trading up 0.8% to 20,068.4 at last check while Dow-related ETFs, the SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA), which tracks the Dow Jones Industrial Average, and the Guggenheim Dow Jones Industrial Average Dividend ETF (NYSEArca: DJD), which weighs the 30 Dow stocks by yield, were up 0.8% and 0.6%, respectively.

ExxonMobil Corp. (XOM), another stock included in the Dow 30, has a former chief executive officer in the Trump administration.

“Of more importance, is whether or not it is able to sustain these gains at a time when US stocks are already considered expensive”, Hewson said.

The best performing stocks have been Goldman Sachs, Disney and Boeing.

What’s next for the Dow now that it has topped 20,000?

The Dow crossed 19,000 on November 22 and continued to gain, as the Trump trade swept the market higher.

Experts warn that the Dow is fundamentally flawed as a market index and that while the 20,000 mark is a welcome psychological boost, it’s hardly a harbinger of sustainable market prosperity.

The VIX, Wall Street’s so-called “fear gauge”, fell to 10.8, a 52-week low and the smallest reading since it touched 10.3 in July 2014, just as the Dow leapfrogged 17,000.

The DJIA has gained 9.5 percent since Trump was elected.

“Individual investors have started buying again, really since the election”.

That’s a dynamic market participants refer to as market breadth, where a diverse base of stocks help lift overall index gains rather than a few.

So 20,000 may just be a number, but some market-watchers say it’s a number closely tied to what people believe will happen to the United States economy. “In other words, now we basically know what we’re getting”, he told Business Insider.

“Just remember that, as far as your long-term investment decisions go, it’s a meaningless milestone, an arbitrary “achievement” that, in actuality, means very little – or nothing at all”, said The Motley Fool. It is a much-watched measure of investors’ expectation of market volatility.

“The optimism for positive change here at Bank of America and among our customers is palpable and has driven bank stock prices higher”.

Right now, the CAPE is around 28.

Investors are teeming with confidence, with many citing the pro-growth policies and proposed tax cuts of President Donald Trump’s administration.

He suggested that with the US market trading at an estimated 19x 2016 earnings per share, stock valuations are “high, but not a bubble”. However, other potential risks, like the increased possibility of a trade war or even nuclear war, have been ignored. According to a search on TVEyes, which is a media monitoring service that describes itself as a “search engine for broadcast”, for the term “Dow”, the milestone was only given two segments as of 7 p.m. ET.