5 Stocks That Powered the Dow to a New Record

The totemic index has finally eclipsed its 2007 peak.

By + More

The stock market reflects the broader economy to a certain extent, so it's cause for celebration now that the Dow Jones Industrial Average has finally eclipsed its prior closing peak, set all the way back on October 9, 2007, at 14,165.

The Dow, however, tends to represent big international companies, and there are only 30 companies in the index. Plus, struggling companies are often dropped in favor of up-and-comers. General Motors and AIG, for instance, were part of the index in 2007 but no longer are, since both required federal bailouts to survive. Newcomers include Chevron and United Healthcare.

[PHOTOS: The 2013 Geneva Motor Show]

Of the 30 firms currently represented in the Dow, 12 still have lower share prices than the day of the last peak, according to a breakout by S&P Dow Jones Indices. The biggest laggards are Alcoa, Bank of America, Hewlett-Packard, General Electric and Cisco.

The winners obviously outweigh the losers by just enough to push the overall index above the previous record. Here are the five Dow firms with the biggest stock gains since the last peak:

Home Depot

109 percent gain. This hardware chain benefits from do-it-yourself penny-pinching when times are tough, and is now poised to prosper as the housing market heats up once again.

IBM

74 percent gain. The recession barely slowed down this technology titan, which now offers sophisticated networking services rather than hardware or software.

McDonald's

67 percent gain. This fast-food chain has done a great job of keeping prices down and drawing cost-conscious diners.

Wal-Mart

63 percent gain. A weak economy tends to help this retailer known for low prices.

[READ: 10 Retailers Most Vulnerable to 'Showrooming']

Walt Disney

58 percent gain. This entertainment giant has a powerful brand recognized worldwide and a tight strategic fit between its studio, media networks, theme parks and consumer products.

Of these five firms, three—IBM, McDonald's, and Wal-Mart—have significant overseas operations that have helped them sustain profitability as the U.S. economy has struggled. That's one way the stock market actually diverges from the U.S. economy: Big U.S. firms on average draw about 40 percent of their revenue from foreign markets these days.

[READ: Thank the Fed for the 'Resilient' Economy]

The broader stock market, meanwhile, isn't enjoying quite the record performance that the Dow is. The S&P 500 index is still about 1.5 percentage points below its own record closing high, set on the same day the Dow peaked in 2007. The tech-heavy NASDAQ index is still far below the peak it achieved in early 2000, during the dot-com boom. But investors are happy for any good news to cheer about, so for now, the Dow is king.

Rick Newman's latest book is Rebounders: How Winners Pivot From Setback To Success. Follow him on Twitter: @rickjnewman.