The Dow Jones Industrial Average cruised past 18,000 for the first time ever today, the AP reports. The S&P 500 also broke records this morning, rising six points (0.3%) to 2,084. This followed on the heels of news that the US economy grew at a sizzling 5% annual rate in the July-September period, the fastest in more than a decade, boosted by strength in consumer spending and business investment. The Commerce Department today sharply revised up its estimate of third-quarter growth from a previous figure of 3.9%. Much of that strength came from consumer spending on health care and business spending on structures and computer software. It was the fastest quarterly growth since the summer of 2003 and followed a 4.6% annual growth rate in the April-June quarter.
Most economists think growth is slowing to an annual rate of around 2.5% in the current October-December quarter and foresee growth around 3% in 2015—the strongest figure since the economy expanded 3.3% in 2005, two years before the Great Recession began. Even after the recession ended in June 2009, the economy has turned in mediocre growth rates, averaging 2.2% annually. But many analysts think growth is finally set to accelerate as more businesses have grown confident about hiring, with the country on track to have its healthiest year for job growth since 1999. In November, employers added 321,000 jobs, the biggest one-month increase in three years. Solid gains are expected in consumer spending, which accounts for about 70% of the economy. (Read more US economy stories.)