Wall Street's Week to Soar: Economic Data Spurs a Stock-Buying Frenzy
The stock market has awakened from its summer slumber and pushed the Dow Jones industrial average up 126 points this week.</br></br>Many investment strategists are saying the economy is growing nicely with little inflation, and that should translate into a long period of good corporate profits.</br></br>YesterdayÛªs 51-point rally in the DowÛÓon top of a 71-point gain on WednesdayÛÓwas sparked by another report indicating that the economic recovery is slowing to a more sustainable paceÛÓone that is less likely to trigger inflation.</br></br>The Commerce Department report said the gross domestic product, the broadest measure of the economyÛªs growth, increased at a</br></br>Investors had forecast an even higher rate. In the logic of the stock market, what seems to be good newsÛÓa roaring economyÛÓactually can depress investments because of the inflation that can accompany fast growth. Inflation eats away at the future stream of profits, dividends and interest income to owners of capital.