The stock market has maintained its smooth upward pace since the government shutdown ended in mid-October.
Perhaps too smooth.
The record-breaking run that continued Friday is unnerving some on Wall Street who worry that stock prices are getting ahead of themselves.
The market sailed to its third straight weekly gain with the Standard & Poor's 500 index notching a fresh high and the Dow Jones industrial average nearing a new peak.
The Dow climbed 61.07 points, or 0.4%, to 15,570.28. It rose a little more than 1% for the week, and is up almost 19% this year.
The S&P 500 rose 7.70 points, or 0.4%, to 1,759.77 and is up 23.4% this year. That's just a fraction behind its 23.5% advance in 2009 when the market rebounded from the 2008 global financial crisis.
Stocks have been fueled by the belief that the Federal Reserve will maintain its economic stimulus program into next year. The shutdown appears to have boosted the market by increasing the likelihood that the Fed will extend its easy-money policies.
But the climb in share prices has been accompanied by rising complacency among individual and professional investors. That's historically been a warning sign of trouble ahead.
"Everyone is reading from same script — that you can't lose buying the dips because the Fed is by your side. And it's clearly working," said Patrick J. O'Hare, chief market analyst at briefing.com.
"The problem is: No one expects it not to work," O'Hare said. "Eventually that leads to higher levels of speculation that can make the setback, whenever that setback happens, more painful than it otherwise would be."
Optimism is everywhere, even among small investors who have been skeptical of stocks throughout much of the 41/2 -year-old bull market.
In the latest weekly poll by the American Assn. of Individual Investors, 49.2% of people responding said they're bullish. That's up from 29% in late August. Bearish sentiment slid to 17.6% from 43%. That's the lowest since January 2012.
Professionals are even more enthusiastic. A survey last week by the financial newspaper Barron's found that 65% of money managers are bullish. A mere 8% admitted to being bearish.
Margin debt, which is the amount of money that investors have borrowed to buy stocks, topped $400 billion for the first time last month.
The euphoria is showing up in big-name stocks, especially technology darlings.
Shares of online retailer Amazon.com Inc. bolted more than 9% to a record high Friday after the company reported a 24% surge in third-quarter revenue but not a dime in profit — a $41-million loss instead.
Google Inc.'s stock bolted almost 14%, to top $1,000, after the online-search giant's third-quarter profit report last week.
Interest in initial public offerings is very high, especially the upcoming debut of short-message phenomenon Twitter Inc.
Shares of Potbelly Corp. more than doubled in its initial public offering three weeks ago.
"They make sandwiches," O'Hare said. "There's not a huge competitive moat there, and the stock doubled on its first day. There's a lot of money looking around for somewhere to go."
Despite a still-choppy economy, investors think that moderate growth and low inflation will convince the Fed to delay a so-called tapering of its monthly $85 billion in bond purchases, aimed at stimulating the economy.
But the higher that share prices go, the bigger the risk of a sharp decline when the central bank eventually pulls back.
"The Fed for the last five years has been driving stock prices higher," said Robbert van Batenburg, director of market strategy at Newedge in New York. "If and when they stop, the party is over. The extent to which the party stops — that remains to be seen."
Markets typically have a 10% correction every 11 months, said Erik Davidson, deputy chief investment officer at Wells Fargo Private Bank. The current bull market has gone without one for more than two years.
"It's just eerily quiet right now," Davidson said. "We're kind of running out of things to worry about, which is a little worrisome in and of itself."
Share prices are rising despite relatively subdued corporate earnings.
The average company in the S&P 500 is expected to report third-quarter growth in profit of 4.5%, according to S&P Capital IQ. That's up from an estimated 3.4% on Oct. 1, but down from the projected 9.8% at the start of the year.
As of Friday, 245 companies had reported earnings results for the third quarter. Of those, 165 beat analysts' estimates, while 46 missed, and 34 have met expectations, S&P Capital IQ said.
Stocks rose Friday despite a sharper-than-expected drop in consumer confidence. A sentiment index from the University of Michigan and Thomson Reuters fell to its lowest level this year.
Investors were willing to shake that off, believing that confidence will recover now that the government shutdown is over. Investors also were buoyed by a notable jump in orders for durable goods.
"I wouldn't say the market is terribly overvalued," Cam Albright, director of asset allocation at Wilmington Trust Investment Advisors.
But, he said: "The market is probably not going to go up as quickly as it's gone up so far this year."
Times staff writer Jim Puzzanghera contributed to this report.