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ByStanChoe The Associated Press NEW YORK Thestockmar- ket is hitting new heights, and yes, excitement about President Trump's policies is part of the reason for it. But it's not the only one, an- alysts say. Even if Donald Trump had lost the election, many professional investors and analysts say they still would have expected stocks to rise, just perhaps not to the same degree. The Standard & Poor's index has leapt 11.3 percent since Election Day, packing more gains into four months than it's had in four of the last six full years. It dipped a bit Thurs- day, but it's still close to its record set a day earlier. Here's a look at some of the factors behind the strong run for stocks: • The Trump bump. The first reaction for markets to Trump's win of the White House was con- fusion. Many investors had been expecting a victory for Hillary Clinton, and markets around the world tumbled on election night as the result became ap- parent. But they reversed course within hours. The reason: Investors are ex- pecting the Trump White House to push through tax cuts for businesses and to loosen regulations on them. Lower tax bills for com- panies should lead to an immediate rise in earn- ings, and stock prices tend to track profits over the long term. Easier regula- tions should also help busi- nesses, the thinking goes, particularly big banks and other financials that have been under restrictions im- posed following the finan- cial crisis. Financial stocks have been the best-perform- ing sector by far of the 11 that make up the S&P 500 since the election. Besides the hope for looser regula- tions, analysts are also ex- cited about the prospect for bigger profits given re- cent gains in interest rates, which will make lending money more profitable. • The economy is getting better. Growth has been frus- tratingly slow since the end of the Great Recession, but the job market is pick- ing up steam. The unem- ployment rate in January was 4.8 percent, and econ- omists see the economy as close to full employment. A report on Thursday showed that the fewest number of workers applied for unem- ployment benefits last week since Richard Nixon was in the White House. Improvement was under- way before Trump entered the White House, but his election has spurred things along. Optimism among small businesses, for ex- ample, spiked higher after the election and is now at its highest level since 2004, according to surveys from the National Federation of Independent Business. Confidence also jumped for regular households fol- lowing the election, and consumer confidence is at its highest level since the summer of 2001. If that translates into more pur- chases at stores and else- where, it should drive even more economic growth. Other economies around the world are also improv- ing, raising expectations for profits of big U.S. compa- nies, which do a lot of their business overseas. • Higher confidence all around. Confidence has spread even to regular investors. After years of hiding out in bonds and other safer in- vestments, retail investors began creeping back into stock mutual funds and ex- change-traded funds fol- lowing the election. Inves- tors plugged $20.7 billion into U.S. stock funds in No- vember, the biggest month in nearly two years. They've followed that up with more purchases. That buying has helped to bid up stocks even more. • Corporate profits are getting better. Big businesses are fi- nally earning bigger prof- its again. Earnings per share for companies in the S&P 500 were nearly 6 percent higher last quarter than a year earlier, with nearly all of the companies re- porting, according to S&P Global Market Intelligence. It's a sharp turnaround from a year ago, when low oil prices and other factors were pulling down prof- its for S&P 500 companies. Profit growth was particu- larly strong for technology and financial companies. Microsoft's earnings rose on stronger sales of busi- ness software, for example, and investment banks re- ported a strong quarter for their trading operations. But just as each of these pillars has helped to lift stocks in recent months, a weakening of any of them could remove some sup- port. If tax cuts come later than expected, or if they end up being only minor ones, it could mean a drop for stocks. Critics also worry that that stock prices have run up at a time when they were already looking overpriced relative to their earnings. One popular way to mea- sure whether the stock market is expensive or not is to compare the S&P 500's level against its earnings over the prior 10 years, ad- justed for inflation. By that measure, which was popu- larized by Nobel-winning economist Robert Shiller, the S&P 500 is close to its most expensive level since the dot-com bubble was de- flating in 2002. WALL STREET The bump isn't just Trump: what's driving stock rally RICHARDDREW—THEASSOCIATEDPRESS Trader Richard Cohen wears a "Dow 21,000" cap as he works on the floor of the New York Stock Exchange on Wednesday. By Zeina Karam and Philip Issa The Associated Press BEIRUT Syria's military an- nounced on Thursday it has fully recaptured the historic town of Palmyra from the Islamic State group as the militants' defenses crum- bled and IS fighters fled in the face of artillery fire and intense Russia-backed air- strikes. The development marks the third time that the town — famed for its priceless Ro- man ruins and archaeologi- cal treasures IS had sought to destroy — has changed hands in one year. It was also the second blow for the Islamic State group in Syria in a week, after Turkish backed op- position fighters seized the Syrian town of al- Bab from the militants on Feb. 23, following a gru- eling three month battle. In neighboring Iraq, the Sunni extremist group is fighting for survival in its last urban bastion in the western part of the city of Mosul. For the Syrian govern- ment, the news was a wel- come development against the backdrop of peace talks underway with the opposi- tion in Switzerland. "You are all invited to visit the historic city of Pal- myra and witness its beauty, now that it has been liber- ated," the Damascus envoy to the U.N.-mediated talks, Bashar al-Ja'afari, told re- porters in Geneva. "Of course, counterter- rorism operations will con- tinue until the last inch of our territory is liberated from the hands of these foreign terrorist organiza- tions, which are wreaking havoc in our country," he added. The Damascus mili- tary statement said troops gained full control of the desert town in central Syria following a series of military operations carried out with the help of Rus- sian air cover and in co- operation with "allied and friendly troops" — govern- ment shorthand for mem- bers of Lebanese mili- tant Hezbollah group who are fighting along Syrian President Bashar Assad's forces. IS defenses around Pal- myra had begun to erode on Sunday, with govern- ment troops reaching the town's outskirts on Tues- day. The state SANA news agency reported earlier that government troops had entered the town's archaeological site, a UNESCO World Heritage Site, around mid-day, then the town itself, as IS mili- tants fled the area. This is the Syrian govern- ment's second campaign to retake Palmyra. It seized the town from Islamic State militants last March only to lose it again 10 months later. Before the civil war gripped Syria in 2011, Pal- myra was a top tourist at- traction, drawing tens of thousands of visitors each year. The Kremlin spokesman, Dmitry Peskov, had said earlier that Russian Presi- dent Vladimir Putin was in- formed by his defense min- ister that Syrian troops had gained control of Palmyra, with support from Russian warplanes. The Syrian government's push has relied on ground support from Hezbollah and Russian air cover, ac- cording to Hezbollah's me- dia outlets. Archeologists have de- cried what they say is ex- tensive damage to its ruins. ROMAN RUINS Syrian army retakes town of Palmyra as Islamic State defenses crumble | NEWS | REDBLUFFDAILYNEWS.COM FRIDAY, MARCH 3, 2017 4 B