Why the Dow Is Rallying This Morning
Despite General Electric (NYS: GE) reporting flat earnings this morning, the Dow Jones Industrial Average (INDEX: ^DJI) is rallying for a fourth day in a row as U.S. home sales rose 5%. At 10 a.m. EST, the Dow was up 30 points to 12,653. The S&P 500 (NAS: ^GSPC) was down three points to 1,311.
General Electric reported disappointing earnings before the market opened, with earnings falling 18% to $0.39 per share. This was above the Street's expectation of $0.38 per share, but revenue missed big -- $38 billion versus expectations of $40 billion. In early trading, GE fell 2.4% before rising to be down just 1%.
U.S. home sales data from the National Association of Realtors is the big news of the morning, rising 5% to a 4.61 million annualized rate. This rise has helped housing inventory up for sale to fall to the lowest level since 2005.
Today's top Dow stock is IBM (NYS: IBM) . The company is leading the pack, up 3.6% to $187.17. Runner-up is Microsoft (NAS: MSFT) , up 3.45% to $29.08. Both of these tech giants reported positive earnings last night, and our senior technology analyst, Eric Bleeker, believed correctly that they would drive the Dow higher today.
The best approachWatching the broad market each day is exciting, gut-wrenching, and stressful, but investing doesn't have to be. If you're in the mood to pick up a great company to buy for the long term, The Motley Fool has created a brand-new free report: "The Motley Fool's Top Stock for 2012." It features a company hand-selected by the Fool's chief investment officer that has a strong future ahead of it. Get access to the report and find out the name of this legendary company. The report is free but won't be forever, so check it out today.
At the time this article was published Dan Dzombakholds no position in any company mentioned.Click hereto see his holdings and a short bio. The Motley Fool owns shares of International Business Machines and Microsoft.Motley Fool newsletter serviceshave recommended buying shares of and creating a bull call spread position in Microsoft. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.