1 Reason the Dow Is Hitting Multiyear Highs
It's official, folks: The Dow Jones Industrial Average (INDEX: ^DJI) skated by previous records to close at multiyear highs today. The index, comprised of 30 blue-chip stocks, closed at 12,878 for the day, eclipsing the high water mark set in May 2008.
So what's the fuel that pushing the index higher? Greece. Though the debate about Greek debt seems stuck in a Mobius strip of never-ending back-and-forth indecision, there seems to be just a little progress today as Greece made moves towards securing international aid.
The news had a positively impact on all three of the major indices today, with each one ending in the black. Here's a look how each one fared.
Gain / Loss
Gain / Loss %
|Dow Jones Industrial Average||+33.07||+.26%||12,878|
The Big Movers
Today was an especially good day for a few Dow components, most notably McDonald's (NYS: MCD) . The burger-slinger closed up 1.43% for the day, pushing share prices to just over $100. The Golden Arches recently reported strong December sales and fourth-quarter earnings, but on the day they released shares, was down 2% on foreign-exchange concerns. Enter Yum! Brands (NYS: YUM) , which reported impressive earnings last night on strong Chinese growth. Investors are likely transposing Yum!'s strong Asian performance onto McDonald's, and forgetting their prior concerns about weakness. Yum! was up 2.6% for the day.
The yin to McDonald's yang, Bank of America (NYS: BAC) was the worst-performing Dow stock of the day. The big bank fell 1.5%, despite positive news out of Greece. Because positive European news usually sends banks higher, many investors are left scratching their heads. My best guess is that the banks are further away from a mortgage-fraud settlement than was previously expected. The man likely behind it? Eric Schneiderman, the boogie man of the big banks right now -- he seems intent on investigating them, and his Friday lawsuit filings will ensure they don't sleep easy. Citigroup (NYS: C) was correspondingly down at market close.
The best way to play it
The breadth of news that moves the markets on any given day can be dizzying for investors to wrap their minds around. If you're looking for a buy-and-hold salvation from the day-to-day market madness, look no further than "The Motley Fool's Top Stock for 2012."
Our pick for the year is an emerging market retailer that's parroting a proven business model from the U.S. and applying it to the high growth Latin American market. I invite you to access a free copy of the report by clicking here. It won't be free forever, so get your copy while you can.
At the time this article was published Austin Smith owns shares of McDonald's.The Motley Fool owns shares of Bank of America, Yum! Brands, and Citigroup.Motley Fool newsletter serviceshave recommended buying shares of Yum! Brands and McDonald's. 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.