NEW YORK — A late surge in blue chip stocks lifted the market to another broad-based gain Wednesday, extending a powerful mid-December advance. Transportation and technology stocks led the gainers.
Analysts said new declines in crude oil prices contributed to the latest rise in stock prices. But they said a more fundamental reason was the market's stubborn refusal to give in to selling that would erode its recent gains.
The Dow Jones average of 30 industrials, which had drifted narrowly after rising 8.62 points on Tuesday, soared in the final hour of trading to post a 32.99-point gain and closed at 1,974.47.
In the past eight sessions, the market's best-known indicator has risen nearly 208 points, or about 11.8%.
Advancing issues outpaced decliners by a margin of more than 2 to 1 among issues listed on the New York Stock Exchange, with 1,145 stocks up, 469 down and 382 unchanged.
Volume on the Big Board came to 193.82 million shares, compared to 214.97 million shares on Tuesday.
Even Skeptics Impressed
Some market analysts had expected blue chip stock prices to pause after rising over the past seven sessions.
But Lewis Smith, a technical analyst for the investment firm Bear, Stearns & Co., said even the skeptics were impressed that the market held its ground Wednesday during what was shaping up as a lackluster session.
He said some investors were worried that the market had risen too quickly. But he said others with substantial amounts of cash were looking for any sign of weakness as an opportunity to get back into the market.
It was this group that helped propel the market higher in the final hour of trading, he said. "We are gradually forcing in the folks that are unconvinced that it is an up market," Smith said.
Crude oil prices have fallen for three consecutive sessions as oil industry analysts have discounted the significance of the latest OPEC production accord.
Encouraging Economic Reports
On Wednesday, crude oil prices slipped to their lowest level in a year. Market analysts say the oil price decline has diminished fears about inflation and encouraged speculation that fuel costs could be headed lower.
The market has also been heartened by a series of government reports for November indicating that the economy continued to grow after the mid-October stock market crash.
In the latest evidence on that score, the Commerce Department reported that housing construction climbed 7.5% in November, the biggest increase in almost a year. It said it expects business investment spending to rise by 7.3% next year, the best showing since a 9.6% rise in 1985.
In early trading in Tokyo today, the dollar set a record low at 126.00 yen before rebounding to 126.30, sending stock prices lower. The Nikkei Stock Average of 225 selected issues, down 27.31 points Wednesday, fell back after early morning gains to shed 22.44 points before closing today's morning session at 22,796.98.