The Dow ended with a gain of 76.19 points to close at a record 6,625.67 after jumping nearly 108 points as interest rates sank in the bond market. But in a sharp contrast to the day's enthusiasm about inflation, the Dow's advance was led by its oil-related components, which benefited from the recent spike in energy prices.
Today's Dow advance erased yesterday's 51-point slide and beat Tuesday's record finish at 6,600.66.
Broader market measures flirted with new highs, but came up slightly short, with bellwether technology shares lagging the blue-chip rally.
Advancers led decliners by a 12-to-7 margin on the New York Stock Exchange, with 1,631 up, 954 down and 764 unchanged. NYSE volume totaled 554.12 million shares vs. 556.57 million yesterday.
The Standard & Poor's 500-stock list rose 6.44 to 754.85, and the NYSE's index rose 3.33 to 398.58, just shy of Nov. 25's record close at 398.86. The Nasdaq index rose 5.95 to 1,326.30, and the American Stock Exchange composite rose 5.01 to 576.72.
Stocks continued to take their cue from bonds, which recovered yesterday's losses after the Labor Department reported that although wholesale prices shot up 0.5 percent in December.
As bond prices rose today, the yield on the 30-year Treasury bond - a key determinant of corporate and consumer borrowing costs - fell from late yesterday's 6.84 percent, the highest level since late October, to 6.75 percent.