Why These 3 Dow Stocks Soared Today

Updated

Monday gave investors a tale of two markets. On one hand, the big blue chips in the Dow Jones Industrial Average (INDEX: ^DJI) provided some solid gains, with the average closing up 72 points to 12,921. But the rest of the market wasn't nearly as optimistic, with significant pressure from tech stocks pulling the Nasdaq down. Meanwhile, overseas markets were equally wishy-washy, with markets in Japan and the U.K. down but Germany and France rising.

Let's look at three of the stocks that contributed to the Dow's big gains today.

Travelers (NYS: TRV) , up 1.8%
Last Friday, shares of Travelers took a hit when equity research firm Zacks downgraded the stock to underperform. The researchers pointed to losses from early snows in the Northeast last fall and weakness in its investment income resulting from low interest rates.


But today, Travelers made up all that last ground. As tough as last year was for the insurance industry, it's time to look forward. A relatively mild winter should help the company post lower losses from the year-ago winter months. And although weather-related events will inevitably keep happening, Travelers could benefit greatly if it can avoid some of the devastating catastrophes we saw last year.

Procter & Gamble (NYS: PG) , up 1.5%
Sometimes, all it takes to make investors happy is to give them a little more money. That's what P&G did after the market closed last Friday.

The consumer giant boosted its dividend by 7%, with investors now slated to receive $0.562 every three months. The move marks the 56th consecutive year that P&G has raised its payout, putting it among the old-time elite among the Dividend Aristocrats. As investors start to fear a possible pullback, companies that have that kind of stability are worth more than ever.

Home Depot (NYS: HD) , up 1.4%
Investors also like to see stocks hit 52-week highs. Home Depot made the list today as the stock received positive comments from an analyst.

Piper Jaffray argues that while most people focus on strength or weakness in the housing market as important for home-improvement retailers' prospects, remodeling plans play at least as essential a role in profitability. The analyst believes that there's more than enough growth for both Home Depot and Lowe's (NYS: LOW) , which it also upgraded today.

What's next?
With the Dow up, the Nasdaq down, and investors confused, you have to keep your eyes open for any edge you can find. One key to success is paying attention to what companies say in their quarterly reports. To maximize your profit opportunities, let me invite you to get some insight from The Motley Fool's brand-new special report, which identifies five stocks that investors simply have to watch this earnings season. The report is free, so get the scoopbefore these companies report.

At the time thisarticle was published Fool contributorDan Caplingerdoesn't own shares of the companies mentioned. You can follow him onTwitter.Motley Fool newsletter serviceshave recommended buying shares of Home Depot and Procter & Gamble, as well as writing covered calls on Lowe'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 Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Advertisement