The Dow Tops 13,000
It sounds like a great way to head into the weekend. The Olympics Opening Ceremony takes place tonight, U.S. economic growth met expectations, and the markets surged for the second straight day. The Dow Jones Industrial Average (INDEX: ^DJI) killed it to the tune of 1.46%, surpassing 13,000 for the first time in months, and the S&P 500 (INDEX: ^GSPC) jumped 1.91%. A lot of analysts are thanking the GDP numbers and Fed stimulus hopes, but the peace of mind offered by statements from ECB chief Mario Draghi probably played a larger role.
The GDP numbers apparently hit the sweet spot between "bad enough for Fed assistance" and "good enough to ease concerns." But that Fed speculation intensifies every time the markets drop, and the GDP numbers alone offer little reason for a nearly 200-point rise. Investors might have feared worse, but an annualized GDP growth of 1.5% offers little room for such optimism. On the other hand, the Draghi comments from yesterday eliminated some of the uncertainty scaring investors, as the ECB chief guaranteed that the Eurozone will remain intact. He could be wrong, but his comments reassured investors, motivating them to take advantage of relatively cheap stocks throughout the markets.
Almost everything except Facebook soared today but, as usual during this time of year, earnings drove the biggest movers. Expedia (NAS: EXPE) rocketed more than 20% after it grew revenue and beat analyst earnings expectations, posting an EPS of $.76. After spin-off TripAdvisor lost profit year over year when it released earnings, the Expedia numbers provided some Friday cheer on the parent company's overall direction.
Earnings also carried Amazon (NAS: AMZN) to a huge day. Shares jumped 7.87% after the company announced 29.5% revenue increase year over year, while earnings hit expectations at $.01 per share. The company continues to focus on long-term prospects, eating up market share with razor-thin margins, and continuing to build for the long term. Like Wal-Mart, it generates profit on pure volume of its ever-expanding sales numbers.
But, as always, the euphoria didn't touch every stock. An earnings miss sent Starbucks (NAS: SBUX) shares to their worst day in 12 years, although they only missed EPS expectations slightly with a $.45 number. Analysts expected an EPS of $.47, but the company still managed to push up revenue 12.7% compared to the year-ago quarter. Still, Robert W. Baird downgraded the company to neutral.
In the end, though, stocks saw a great day overall, and the outlook continues to improve going forward. But volatility will remain, so many investors are looking at stocks with the dividends necessary to survive dips, and the growth potential to soar during big sessions. The Motley Fool identified three Dow stocks every dividend investors needs in a free report. Get your copy before it's gone!
The article The Dow Tops 13,000 originally appeared on Fool.com.Fool contributor Will Chavey owns no shares of the stocks mentioned above. The Motley Fool owns shares of TripAdvisor and Starbucks.Motley Fool newsletter serviceshave recommended buying shares of Starbucks, Facebook, Amazon.com, and TripAdvisor.Motley Fool newsletter serviceshave recommended creating a bull call spread position in Wal-Mart Stores.Motley Fool newsletter serviceshave recommended writing covered calls on Starbucks. 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.
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