NEW YORK — Stocks hit their highest levels in nearly three years Tuesday, thanks to signs that earnings are rising for U.S. companies and consumers are feeling more confident about the economy. The Russell 2000, the benchmark index of small companies, neared a record high.
The new highs continue a historic recovery in the stock market. Stock indexes have more than doubled since hitting a 12-year low in March 2009. The fastest bull market since the 1950s has now erased most of the losses stemming from the financial crisis.
Investors who bought at the top of the market in 2007 have now lost 4.2 percent, including reinvested dividends. Analysts predict stocks will continue to rise if unemployment keeps falling and global demand leads to more profit growth.
The Standard & Poor’s 500, the benchmark for most mutual funds, reached its highest level since June 2008. It gained 11.99 points, or 0.9 percent, to 1,347.24. It’s still 16 percent below its record high of 1,565 in October 2007.
The Dow Jones industrial average also marked a high for the year, rising 115.49 points, or 0.9 percent, to 12,595.37. The Nasdaq composite rose 21.66 points, or 0.8 percent, to 2,847.54.
The Russell 2000 rose 1 percent to 853.04, near the record high of 855.77 that it reached in July 2007.
Better-than-expected earnings reports from companies ranging from airlines to office products manufacturers helped drive a broad rally.
“What we’re seeing now is a positive reinforcement of the fact that demand is rising around the world,” said Quincy Krosby, chief market strategist at Prudential Financial, although some companies say rising costs are hurting profits.
