Obama's communist-inspired destruction of the financial markets continues! 
Dow Closes at Highest Level in Nearly 4 YearsBy JONATHAN CHENG
The Dow Jones Industrial Average hit a nearly four-year high, boosted by signs of an accelerating U.S. economic recovery and glimmers of hope on the Greek debt crisis.
The Dow surged 123.13 points, or 1%, to 12904.08. Thursday's rise was the biggest one-day point and percentage gain in two weeks and left the blue-chip index less than 100 points from the 13000 level it last hit in May 2008. The Dow has now run higher for 34 days without a single triple-digit decline, the longest run in more than a year. All 10 sectors of the Standard & Poor's 500-stock index finished with gains.
Investors were lifted by data confirming the recent improvement in the U.S. economy. The number of weekly jobless claims tumbled to its lowest level since March 2008, and manufacturing activity showed more signs of strength. On Wednesday, a reading of home-builder sentiment rose to a near five-year high, and the Commerce Department said Thursday that home construction last month increased 10% from a year earlier, topping economists' expectations.
The rally has offered encouragement, but also raised fears that the market is rising too quickly and can't sustain recent gains. Since early October, the Dow has rallied 21%; the Nasdaq Composite is up 14% this year, perched at an 11-year high.
Meanwhile, small-capitalization stocks have run up 36% since early October, pushing the Russell 2000 small-cap index to within 4% of the all-time high that it hit last April. The Russell 2000 surged 2% Thursday.
"It's such a cliché, but the risk trade is back on," said Michael Marrale, head of U.S. sales trading at RBC Capital Markets. "With Treasury rates where they are, there's no real alternative to U.S. equities."
The day's gains were led by stocks in the economically sensitive materials, financial and technology sectors. Many of this year's highest-flying stocks continued their winning ways, driving sentiment.Microsoft soared 4.1% and for parts of the afternoon was on pace to finish at a four-year high. Apple, which has staged one of the most impressive gains this year, reversed a morning decline to finish back above the $500 level, while Bank of America tacked on another 4% to put its advance this year at 46%.
"This feels a little bit like a panic to the upside," said Maury Fertig, chief investment officer at Relative Value Partners. With confidence rising that a Greece deal is imminent, and sustained improvement in U.S. unemployment and manufacturing data, investors are racing to catch up with the rally, he said.
"To me, it just sets us up for disappointment. It reminds me of last April, when we got a whole series of good news that blew everyone away," Mr. Fertig said. Buffeted by that momentum, the Dow touched a three-year high before tumbling through the summer. This time, too, he fears, the string of strong data could begin to taper off. "People would then suddenly wonder: 'What happened?' " he said. "It makes me cautious; I wouldn't be putting new money into equities today."
Investor caution has been a hallmark of the recent rally. In the week ended Feb. 8, domestic stock mutual funds saw inflows of $1.9 billion, the biggest inflow since February 2011, according to the Investment Company Institute. Even so, the first six weeks of 2012 have seen a collective $6 billion exit long-term domestic stock mutual funds, according to the ICI.
Some argue that the rally is made stronger by the fact that sentiment doesn't appear to be overly exuberant. "I'm not sure there's enough strength for the market to run away at this point, but stock valuations can go up merely on an alleviation of worries," said Edward Crotty, chief investment officer and portfolio manager at Davidson Investment Advisors in Great Falls, Mont.
Elsewhere, European stocks recovered from sharp declines to finish roughly flat after Moody's Investors Service placed the ratings of more than 100 European financial institutions and 16 European countries on review for possible downgrade. The Stoxx Europe 600 inched up 0.1%, while Germany's DAX and U.K.'s FTSE 100 indexes each fell 0.1%.
After the European markets had closed, the European Central Bank moved to protect its €50 billion ($65 billion) Greek bond portfolio from losses by swapping the bonds for new ones issued by Athens, an action that would protect Europe's central banks from any efforts to force them to take losses.
In corporate news, General Motors surged $2.24, or 9%, to $27.17, after the auto maker reported a record profit of $7.6 billion for 2011, but saw losses in Europe and thin profit margins in the fourth quarter.
Clearwire slid 11 cents, or 4.7%, to 2.25, after the company's fourth-quarter loss widened on rising interest expenses, though its subscriber base continued to expand.
NetApp tacked on 2.86, or 7.2%, to 42.74, to lead the S&P 500, after the data-storage company posted double-digit-percentage sales growth.
J.M. Smucker slid 6.55, or 8.4%, to 71.60, after the company reported weaker-than-expected fiscal third-quarter results and cut its full-year earnings outlook.
Blue Nile tumbled 4.31, or 10%, to 37.52. The online jewelry retailer reported disappointing fourth-quarter earnings and revenue, and indicated its results for the current quarter will fall short of expectations.
Amazon.com fell 4.54, or 2.5%, to 179.93, after analysts at Morgan Stanley trimmed the stock's rating to "equal weight" from "overweight," warning that Apple's iPhones and iPads sales could take away market share in electronic books. The stock fell even after a report from IHS showed Amazon's Kindle Fire and other low-price tablets cut into Apple's market share in the fourth quarter. Apple rose 4.54, or 0.9%, to 502.21.
Paccar rose 2.17, or 4.9%, to 46.51, after the chief executive of Swedish truck maker Scania said the European truck market has bottomed out. Europe's truck market has been weighing on Paccar because its DAF truck brand is a major player in the European market.
Molson Coors Brewing's fourth-quarter earnings climbed 58% amid stronger-than-expected sales growth; shares rose 1.24, or 2.8%, to 45.10.
—Chris Dieterich contributed to this article.
