The Dow Jones industrial average finished above 25,000 for the first time, as the long rally in stock prices showed no signs of letting up.
A strong report about hiring from payroll processor ADP helped push stocks higher. Financial stocks did especially well, and an increase in oil prices has benefited the energy sector.
The Dow finished the day at 25,075, a gain of 0.61 percent. Both the Nasdaq composite index and the Standard and Poor's 500 index also finished at record highs.
Last year turned out to be the best for the market since 2013, with the Dow climbing more than 25 percent. It rose 4,000 points over the last 10 months.
"It was the first year in history where you saw every single month up," said Liz Ann Sonders, chief investment strategist at Charles Schwab.
Sonders attributes much of the surge in prices to broad economic factors, including low interest rates and healthy growth.
"I think the turn in earnings and the strength in global growth was enough to propel the market, and then the longer-term story has been just massive liquidity, courtesy of the central banks," she added.
The Federal Reserve and other central banks for years funneled extra money into the economy through a process known as quantitative easing, to stimulate growth. They have also kept interest rates low, although lately they have begun to reverse course.
Jeremy Siegel, professor of finance at the University of Pennsylvania's Wharton School, says the expectation of a large corporate tax cut and deregulatory efforts by the Trump administration probably played a part in last year's rally.
Four days into the New Year, prices have continued to barrel ahead.
Earlier this week, the Nasdaq composite index finished above 7,000 for the first time, and the broader Standard and Poor's 500 index also set a record.
But no rally lasts forever, and the prospect of higher interest rates could put the brakes on this one.
"We think the economy will be a little bit stronger, juiced a little bit by tax cuts, but we are getting later on in that cycle. Maybe we're in the eighth inning or so," said Paul Christopher, head of global market strategy at Wells Fargo Investment Institute.
ROBERT SIEGEL, HOST:
We are four days into the new year and the stock market rally shows no signs of letting up. Today, the Dow Jones Industrial Average finished above 25,000 for the first time. NPR's Jim Zarroli reports that strong global growth and low interest rates are behind the surge.
JIM ZARROLI, BYLINE: A lot of people predicted that Donald Trump's election would bring an end to the long, multi-year rally in stock prices. They couldn't have been more wrong. The Dow climbed 25 percent last year, as Trump frequently points out.
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PRESIDENT DONALD TRUMP: Our stock market just hit another record high. It's the highest it's ever been in history by far.
ZARROLI: And the market keeps rising. But Liz Ann Sonders, chief investment strategist at Charles Schwab, says just because the rally has happened under Trump's watch doesn't mean he should take much of the credit for it.
LIZ ANN SONDERS: Just simply being objective and looking at the numbers there have been plenty of other presidents who have had a better stock market. I wouldn't suggest that any of those presidents deserve most of the credit.
ZARROLI: Instead, Sonders says, the stock market has been reacting to a lot of broader economic factors.
SONDERS: I think the turn in earnings and the strength in global growth was enough to propel the market. And then the longer-term story has been just massive liquidity courtesy of central banks.
ZARROLI: Sonders says it's not just the Federal Reserve that has been keeping interest rates relatively low. So have central banks in Europe and Japan. And so there's been a confluence of low interest rates and strong global growth. In fact, this is the first time since before the Great Recession that all of the world's major economies are growing at the same time. Stocks have been going up everywhere, and investors have been the beneficiaries. Emily Ruff, who teaches at a college in Minnesota, got her first retirement account five years ago. During that time stocks have steadily risen, which actually worries her.
EMILY RUFF: I'm a little bit nervous about what's going to happen and people talking about how the current tax policies might overheat the market. And it's been about 10 years since the last recession, so we're kind of due.
ZARROLI: In fact, the big corporate tax cuts just passed by Congress should be good for the bottom line at most companies, and surveys of business leaders suggest they're feeling pretty optimistic about the future. Still, the rally is showing signs of aging. Paul Christopher is head of global market strategy at Wells Fargo Investment Institute.
PAUL CHRISTOPHER: We think the economy will be a little bit stronger, juiced a little bit by tax cuts. But we are getting later on in that cycle. Maybe we're in the eighth inning or so.
ZARROLI: If nothing else, the Fed and other central banks are already taking steps to raise interest rates, and that could finally begin to put the brakes on the market's long rally. Jim Zarroli, NPR News, New York. Transcript provided by NPR, Copyright NPR.