NEW YORK — A comment by Federal Reserve Chairman Paul A. Volcker to a Canadian civic club gave a lift to the stock and bond markets Tuesday, sending prices broadly higher amid diminished investor concern over future interest rates.
At one point, the Dow Jones average of 30 industrial stocks was more than 4 points above its Oct. 17 record closing high of 1,369.29. But, at the close of trading, the average stood just under the record at 1,368.73, up 8.74.
Volume on the New York Stock Exchange was 110.60 million shares, up from Monday's 97.88 million shares.
Speaking in Toronto, Volcker said he did not expect that the recent expansion of the money supply would kick off a new jump in inflation, even though the growth has been greater than the Fed would like.
"Volcker's comments seemed pretty much good news, coming from him," said Eldon A. Grimm, senior vice president of Birr, Wilson & Co. "The market took his comments to mean that he doesn't feel interest rates are going to rise."