Dow Up 39 on Interest Rate Cut Hopes
NEW YORK, Feb. 4ÛÓBoth blue-chip stocks and smaller issues rose to new highs today, following congressional testimony by Federal Reserve Chairman Alan Greenspan that traders saw as a sign that further interest rate cuts are possible down the road.</br></br>The Dow Jones industrial average closed up 38.69 points at 3272.81, edging past its prior record, 3272.14 set Jan. 28. In the broader market, gaining issues led those losing by about 2 to 1 on heavy New York Stock Exchange volume of 231.5 million shares.</br></br>Greenspan told a congressional committee that while the central bank is holding credit steady for now, the Fed is continuing to evaluate whether . further rate cuts may be necessary.</br></br>Lower rates tend to spur businesses and consumers to borrow, boosting economic activity and lifting stock and bond prices.</br></br>'ÛÏThe bond market really helped the general market keep going," said Sid Dorr of Charles Schwab & Co.