The galloping Dow Jones Industrial Average may have opened the flood gates for the struggling initial public offering market today, as four new companies started trading while the stock market hit a new high this afternoon.

The IPO market's tone seemed to be transformed by the Dow's rise, as several new issues coming to market today surged along with other stocks -- a reversal of the gloomy behavior plaguing some of this year's earlier offerings. Indeed, thanks to the slate of new arrivals yesterday and today, IPO issuance in the first 10 days of February has already topped $1 billion, something it didn't accomplish during the entire month of January.

Investors are watching the IPO market closely. For one, the lack of IPO activity has helped improve the market's so-called liquidity picture. With money pouring into stock funds, and few new issues available, demand for stocks has jumped accordingly. Bulls like it when the IPO market is healthy. They dislike stampedes to the public trough. For now, the IPO market is just getting into a strong-trickle stage after a bone-dry January.

Three IPOs were priced in the morning, including CDNow (CDNW:Nasdaq), an online retailer that is hoping to be to music aficionados what Amazon.com (AMZN) is to book lovers. CDNow, based in Jenkintown, Pa., priced at 16, well above its initial pricing range of between 13 and 15. The stock has done extremely well in trading today, swelling almost 45% to a high of 23 3/8. It has since settled down, closing at 22, up 6. BT Alex. Brown was the lead underwriter on the deal.

Taking advantage of investors' bullishness, Duane Reade (DRD:NYSE) began trading this morning after pricing at 16.50 per share last night after the market's close. The company, New York City's largest drug store chain, opened about 30% above its price and has remained strong since. The stock closed at 21 9/16, up 5 1/16.

Another success story today was 1-800-Contacts (CTAC:Nasdaq), a direct-mail supplier of contact lenses based in Draper, Utah. Despite some negative publicity from Barron's on Monday (pointing out that the company's 27-year-old president and chief executive officer had not yet received his Master's degree, among other problems), the issue priced at 12.50, slightly above its expected range of between 10 and 12. The offering has traded well, too, rising to a high today of 15 7/8 before closing at 14 1/8, up 1 7/16.

When an IPO is priced during a strong buying rally, such as today, it is possible that the offering will be swept along for the ride, said Michael Essex, head of the equity syndicate at McDonald & Co., which underwrote the deal for 1-800-Contacts. "The perception in the marketplace is that it is a big positive," he said.

Of course, underwriters seldom know what the market is going to do on a given day, but hopefully if the deal is priced with a premium for investors it will do well, Essex explained.

And the IPO action is likely to intensify in coming days. According to syndicate desks there are about 20 more deals expected to be priced this week, including a massive offering for Capital Automotive REIT, which is planning to raise about $300 million. The Capital Automotive deal is the largest IPO of the young year, and its success could further embolden companies seeking a public offering.

More from Stocks

Chart of the Day: How Jerome Powell Could Shift the Semiconductor Landscape

Chart of the Day: How Jerome Powell Could Shift the Semiconductor Landscape

Flashback Friday: Nvidia Is the Ultimate Chip and Dip

Flashback Friday: Nvidia Is the Ultimate Chip and Dip

Dow Ends Higher on Dovish Trump Tariff Comments; Nasdaq Falls

Dow Ends Higher on Dovish Trump Tariff Comments; Nasdaq Falls

How to Play Semiconductors Amid Nvidia's Crash, Cycle Pressure

How to Play Semiconductors Amid Nvidia's Crash, Cycle Pressure

Newmont Mining Has Unearthed a Bullish Reversal Pattern

Newmont Mining Has Unearthed a Bullish Reversal Pattern