Dow falls shy of 20,000 but notches new high

NEW YORK - After coming within 13 points of 20,000, the Dow Jones industrial average fell shy of the milestone but still notched a fresh all-time high.

Bank stocks are higher thanks to a recovery in bond yields and interest rates and industrial and consumer companies build on their recent gains. 

The Dow closed up 91.56 points, or 0.5%, and closed at its 17th record closing high since Election Day at 19,974.62, or less than 25 points shy of 20,000. During the session it notched an intraday record high of 19,987.63 in morning trading. The Standard & Poor's 500 index gained 0.4% and closed at 2270.76, just shy of its record closing high. The Nasdaq composite index hit a record close of 5483.94, after rising 26.50 points, or 0.5%, to 5483.94. 

The blue-chip index has made several attempts to break through the 20,000 mark but each time it’s fallen just short. The index has rallied strongly since the election of Donald Trump as the next U.S. president amid hopes that the incoming administration will be kind to business and back more spending on such things as infrastructure.

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Bond prices fell. The yield on the 10-year Treasury note rose to 2.57% from 2.54%. Bond yields have jumped to longtime highs over the last few months but they fell sharply yesterday. Higher yields allow banks to charge more money for loans, so financial firms traded higher. Goldman Sachs (GS) added 1.7% and Bank of America (BAC) gained 1%.

Benchmark U.S. crude gained 11 cents to $52.23 per barrel in New York. 

In corporate news: 

• Retailer Fred’s (FRED) soared 81% after it agreed to buy 865 Rite Aid stores for $950 million. That’s a huge expansion for Fred’s, which had 648 total stores at the end of October. Only about half of them had pharmacies.

The sale may also clear the way for Walgreens Boots Alliance (WBA) to buy Rite Aid (RAD), a deal that would combine the U.S.’s first and third-largest drugstore chains. That $9.4 billion deal was announced more than a year ago. Rite Aid climbed 5.3% and Walgreens eked out a 0.3% gain. 

•  Cheerios maker General Mills (GIS) said its profit slumped 2.7% during its latest quarter and the company lowered its outlook for the year as it tries to win back customers. Like many of its competitors, General Mills has been hurt as more Americans stay away from processed foods. The company, which also makes Betty Crocker cake mix, expects a bigger decline in organic sales. Its stock lost 2.6%

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Britain’s FTSE 100 was up 0.4% and the CAC-40 in France was 0.6% higher. The German DAX rose 0.3%.

Japanese stocks reached another fresh high for the year after the Bank of Japan left its current monetary policy unchanged. It said the “moderate recovery” of the world’s third-largest economy was on track. The Nikkei 225 index advanced 0.5% and South Korea’s Kospi added 0.2%. Hong Kong’s Hang Seng index fell 0.5%.