The Dow Is Rising Today -- But Why?
The Dow Jones Industrial Average (INDEX: ^DJI) is having another interesting day today, as negative U.S. economic reports are seemingly having the opposite effect than most would expect -- they're helping push the market higher. Reports today showed that U.S. industrial production unexpectedly fell in Ma y, down 0.1%. But investors actually took kindly to the news, as it could raise the probability of further stimulus following the Federal Reserve meeting next week.
Optimism from Europe also seems to be helping the Dow rise today, as investors continue to be upbeat about rumors that central banks would be willing to step in to quell any further economic turmoil caused by Greece's Sunday elections.
Microsoft (NAS: MSFT) was the Dow's highest riser through mid-afternoon trading, up over 2%. Investors embraced reports that the company reached an agreement to acquire Yammer, a San Francisco-based company known as "the Facebook for the workplace" because it provides private social networks for companies. Yammer is currently used by over 200,000 companies and could help bring additional fire sharing and chat features to Microsoft Office.
Financials were also influential in helping pull the Dow up today, with American Express (NYS: AXP) and Bank of America (NYS: BAC) both gaining over 1.5%. The two Dow components are some of the most sensitive to the global economy, and are probably reacting to speculation of improved conditions in the eurozone.
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At the time this article was published Brendan Byrnes owns no shares of any company mentioned above. The Motley Fool owns shares of Microsoft and Bank of America.Motley Fool newsletter serviceshave recommended buying shares of Microsoft.Motley Fool newsletter serviceshave also recommended creating a write covered strangle position in American Express and creating a bull call spread position in Microsoft. The Motley Fool has adisclosure policy.We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.