The Dow Jones industrial average rose on Friday and closed at its highest… (Michael Nagle )
Reporting from New York — The Dow Jones industrial average closed up for the week but did not make it over the psychologically important 13,000 mark.
Stock prices were driven up by optimism about the Greek bailout and the European financial situation.
The Dow rose 0.4%, or 46.47 points, on Friday and ended at 12,950.55, the highest level since May 2008. It was in that month that the blue-chip index last crossed 13,000. The Dow gained 1.2% this week.
The broader market was mixed, with the Standard & Poor’s 500 index up 0.3%, or 3.63 points to 1,361.67. The S&P 500 is still just short of the highs reached last spring.
The technology-heavy Nasdaq composite finished Friday down 0.3%, or 8.07 points to 2,951.78, but was still up for the week.
In Europe, financial leaders signaled that a resolution to the Greek debt crisis is likely to be agreed upon at a summit next week.
American markets were boosted by figures showing that the cost of living is growing more slowly than expected. The consumer price index rose just 0.2% in January, beating the expectations of economists polled by Bloomberg, who expected a 0.3% increase.
Though inflation is being kept in check, unemployment has remained above 8% since February 2009 and paychecks are not able to keep up the increased price of gas, food and household goods. The Labor Department reported that hourly adjusted earnings fell 1% in the last 12 months.
The increases in stock indexes over the last few months have been driven by a stream of evidence that shows the U.S. economy is on the mend.
"Four months ago we were talking double-dip recession and Europe was going to bring a down slide, but now it doesn’t look that way at all," said Ryan Detrick, an analyst at Schaeffers Investment Research in Cincinnati.
There is still an uneasy sense of optimism about the future. Wall Street remains worried that this could be a repeat of early 2011, when a major stock rally collapsed during the second half of the year.
The stock market’s recent climb has caught many investors off-guard, especially because many of last year’s problems are still lingering. Analysts remain concerned that Europe’s debt crisis is far from over, and that corporate earnings and the overall U.S. economy may still weaken.