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Dow tops 20,000 as earnings feed rally, bonds fall

By Jeremy Herron and Joseph Ciolli Bloomberg

The Dow Jones Industrial Average climbed past 20,000 for the first time as stocks around the world extended a rally after corporate earnings reignited investors’ optimism in economic growth. Bonds sold off with oil.

The index for American blue chips took the round-number milestone after a handful of rallies fell short in the past month. It was the second-fastest 1,000-point trip in its history. European equities jumped the most since Nov. 9, swept up in trades favoring banks and cyclical companies.

The yield on 10-year Treasury notes topped 2.50 percent.

The Mexican peso slumped after Donald Trump said he plans to unveil actions that include steps toward building a border wall.

Oil fell on increased U.S. stockpiles.

“With a swift move towards signing executive orders, coupled with underlying positive economic data, clarity has begun to hit the headlines, and all the US indexes are celebrating,” Quincy Krosby, market strategist at Prudential Financial said. “Clarity is the markets’ oxygen.”

The stock surge comes as Trump moves to fulfill pro-growth campaign promises, including identifying possible infrastructure projects, approval of two oil pipelines and cajoling of American carmakers to build plants in the U.S.

Corporate earnings added to the bullish sentiment, with Boeing the latest company to post results that topped expectations.

Other global-growth signals such as rising bond yields are feeding higher bank lending margins, and re-invigorated spending is boosting consumer cyclicals.

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