Optimism pushes Dow over 14,000

The bull market toppled another milestone Thursday: The Dow Jones industrial average closed above 14,000 for the first time.

Shaking off another increase in oil prices and more downbeat assessments of the subprime-mortgage mess, the blue-chip Dow rose 82.19 points to 14,000.41, bringing its year-to-date gain to 12.3 percent.

Microsoft, one of the 30 Dow stocks, gained 59 cents to close at $31.51 a share after reporting earnings that met analysts' expectations. Boeing, also a Dow stock, rose 66 cents for an all-time closing high of $102.48.

Broader indexes also rallied. The technology-dominated Nasdaq composite gained 20.55 points to 2,720.04, its highest close since 2001. The Standard & Poor's 500 index rose 6.91 points to a record 1,553.08 Thursday.

Tech stocks were a big factor in the market's rally Thursday: IBM jumped $4.78 to $115.86, a 5 ½-year high, after the computer giant late Wednesday said second-quarter earnings rose 12 percent, beating expectations.

Strong earnings reports lifted a broad mix of stocks Thursday, including computer-network company Juniper Networks, up $3.33 to $30.06; paint producer Sherwin-Williams, up $5.98 to $72.99; and Tacoma-based temporary-help company Labor Ready, up $4.84 to $27.79.

After regular trading ended, however, Google reported second-quarter earnings that fell short of analysts' consensus estimate. The Internet giant's shares plunged to $510 in after-hours trading, after closing at $548.59.

Still, generally healthy quarterly profit results this week have been reinforcing the basic message of market optimists: Despite high oil prices, the subprime debacle and other challenges, the U.S. economy is strong enough to keep corporate earnings overall moving up. Fast growth in much of the rest of the world also is boosting many companies' earnings.

Al Goldman, market analyst at brokerage AG Edwards in St. Louis, said that many investors' view of the U.S. housing market's woes is "We've got a big problem in one segment of the economy, but it's going to go away" eventually.

Marc Pado, U.S. market strategist at Cantor Fitzgerald, said investors continue to believe that subprime mortgage defaults won't be significant enough to seriously hurt the broader economy.

Even so, many analysts wonder how the market will react if oil prices rise above their previous all-time highs set last summer.

Oil futures in New York rose 87 cents to $75.92 a barrel Thursday. The record high was $77.03 last July.

Rising oil prices have been helping the stock market, in one respect: Energy stocks have been the strongest-performing industry sector in the S&P 500 this year.

Oil prices "are going to stay high for a long time," said Michelle Clayman, chief investment officer at New Amsterdam Partners. She said energy stocks remain one of the favored sectors.