DOW HITS NEW PEAK IN BURST OF TRADING.

Byline: Leonard Sloane The New York Times

The Dow Jones industrial average surged nearly 100 points Monday to a record high.

The sharp rise, following a week of adjustment to a steep sell-off March 8, suggests that the market is warming to the idea that strong economic growth may be a viable alternative to moderate growth with low interest rates. A number of traders said they now expect corporate profits to increase sufficiently to justify higher stock prices.

The view that the economy is growing stronger than had been thought - first indicated by an employment report March 8 showing that more than 700,000 jobs were created in February - was bolstered by a report Friday on industrial production.

"People had a chance to assess the various economic and monetary figures that came out in the last few days," said E. Wayne Nordberg, an equity partner of Lord Abbett & Co. "They realized we have an economy that is not too weak and not too strong - and that's good for stocks."

The Dow industrials climbed 98.63 points, or 1.77 percent, to 5,683.60, marking its 18th new record closing high so far this year. The previous high of 5,642.42 was set March 5. Boeing, which rose 4-3/4 a share, to 85-5/8, and IBM, which was up 4-3/4, to 124-5/8, were each responsible for almost 14 points in the Dow's movement.

And the Dow made its advance despite sharp declines in two Dow components, Walt Disney, which fell 2-3/8 a share, to 66-7/8, and Philip Morris, which fell 4-1/8, to 91-1/4.

Monday's session illustrates the kind of volatility that has become routine for the Dow. Daily swings upward and downward of more than 50 points are no longer rare for the index. Even a surge of 100 points barely seems to raise an eyebrow on Wall Street.

"The wild volatility that the market has experienced should continue," said Jerry Hegarty, a market analyst at Thomson Research. He added that Monday's rally was "an up leg of a trading-range move."

Advancing issues on the New York Stock Exchange outnumbered decliners by more than two to one, 1,725 to 736. But Big Board volume slipped to 437.1 million shares from the extraordinary 536.9 million shares Friday. Turnover last week was the busiest in the history of the New York exchange.

Among the broader market indicators, the Standard & Poor's index of 500 stocks rose 11.22 points, or 1.75 percent - its largest single-session gain since May 31 - to 652.65. And the Nasdaq composite index increased 14.83 points, or 1.35 percent, to 1,114.42.

The Dow Jones transportation average also set a record high, adding 49.46 points, or 2.32 percent, to 2,184.75. UAL, the parent of United Airlines, jumped 7-1/2, to 204-1/4, and Delta Air Lines rose -7/8, to 79-7/8. And shares of Burlington Northern Santa Fe jumped 2-7/8, to 86.

Technology stocks benefited from expectations that these companies would profit significantly this quarter from a strengthening in the economy. Hewlett-Packard shares advanced 3-3/8, to 103; Microsoft's were up 2-7/8, to 105-1/4; Digital Equipment increased 4-7/8, to 69-1/4, and Texas Instruments rose 1-5/8, to 54-1/8. The Morgan Stanley High Tech Index advanced 9.08 points, or 2.7 percent, to 334.96.