Tech Stocks Lift Dow to New Heights
Tech companies are carrying markets today following a notable earnings report from Intel (NAS: INTC) yesterday after the close. By noon, the Dow Jones Industrial Average (INDEX: ^DJI) had risen 0.65% while the S&P 500 (INDEX: ^GSPC) was up 0.6%. Both, however, lag the tech-heavy Nasdaq, which has surged 1.15%.
While the Intel report pushed markets up, investors did not know how to digest a mixed housing report that showed a rise in housing starts but a drop in applications for building permits, according to a report from the Commerce Department. Housing starts surpassed expectations of 745,000 to reach 760,000 starts. However, Ben Bernanke will likely shake up markets again this afternoon during the second part of his semi-annual testimony to Congress. After yesterday's testimony left the door open for more stimulus measures, investors will once again analyze his words for hints for additional quantitative easing. The Fed will also release its anticipated Beige Book survey, which will discuss the business climate in 12 U.S. regions.
Dow in focus
As you might expect, Intel surged and rose to the top of the Dow. The chip maker announced that net income fell only slightly, and lowered its forecasts for the third quarter far less than analysts had feared following competitor Advanced Micro Devices' dramatically lowered projections. In the conference call, Intel CEO Paul Otellini warned of a "more challenging macroeconomic environment," but forecast a positive outlook for Intel with Microsoft's Windows 8 coming out after the third quarter and $699 Ultrabooks to be sold in the fall. Shares of Cisco (NAS: CSCO) , IBM, and Microsoft all rose over 1.5% on Intel's news. Even beleaguered Hewlett-Packard investors caught a break; HP shares rose over 2%.
While the tech sector rose more than 1.5% as a whole, financials posted the only sectorwide loss. Bank of America (NYS: BAC) lagged the Dow, dropping 1.6%, even after beating analysts' earnings expectations. Revenue fell compared to last quarter, although year-over-year comparisons reveal the bank is clearly faring better than its rough stretch last year. Bank of America followed in the footsteps of JPMorgan, Citigroup, and Goldman Sachs, which all beat earnings estimates earlier this week. Clearly, investors are not too excited with Bank of America's results, as expectations had been low for most banks after this rocky quarter.
Earnings season can feel like a hard time to be an investor. Sometimes events even seem to defy logic. Intel lowers third-quarter forecasts, and its shares surge. Bank of America beats expectations, and yet its shares plummet. To better understand the story behind the company, one of our top financial analysts has just put together this premium research report on Bank of America. Inside, you'll receive an easy-to-read take on the key opportunities and threats facing the company along with a full year of analyst updates. Click here to learn more.
The article Tech Stocks Lift Dow to New Heights originally appeared on Fool.com.Foolish intern Charlie Kannel owns no shares of the companies mentioned above. The Motley Fool owns shares of Citigroup, Microsoft, International Business Machines, Intel, Cisco Systems, JPMorgan Chase, and Bank of America. Motley Fool newsletter services have recommended buying shares of Intel, Microsoft, and Goldman Sachs. Motley Fool newsletter services have also recommended creating a bull call spread position in Microsoft and a synthetic long position in International Business Machines. The Motley Fool has a disclosure policy.
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