Why the Dow Is Flying Today
It's about time. Buoyed by a better-than-expected jobs report, the Dow Jones Industrial Average (INDEX: ^DJI) is well on its way to ending a four-day losing streak, rising nearly 2% through midday trading. The S&P 500 (INDEX: ^GSPC) is also up around 2% on the day. Investors were looking for some positive news this week after it became clear further Fed stimulus action was not imminent, and Wednesday's software glitch forced millions of incorrect orders that roiled markets. Though the unemployment rate ticked up a tenth of a percentage point to 8.3%, data showed that the U.S. added 163,000 jobs in July, well above expectations of 100,000. The Dow's jump today of over 200 points has now wiped out the four previous days of losses, and the index is now on track to finish the week in the black.
Kraft (NAS: KFT) is the Dow's biggest gainer so far today, rising over 4%. The company reported impressive earnings after hours yesterday. Kraft earned $0.70 per share, beating analyst expectations of $0.66 per share. Kraft also announced that its much-anticipated split into two companies will officially occur on Oct. 1. A global snacks company called Mondelez will be created on that date, with Kraft retaining the North American grocery business. Though revenue fell for Kraft in its second quarter, investors appreciated to the company's ability to pass along price increases to consumers, rather than discounting to try to stem its declining market share.
Much-maligned PC giant Hewlett-Packard (NYS: HPQ) is also one of the Dow's biggest gainers today, jumping nearly 4% so far. HP is one of the more sensitive stocks on the Dow regarding the economy, so any positive macro news like the upbeat jobs report certainly helps the Palo Alto company. Still, HP remains the Dow's biggest loser this year, declining around 29% so far in 2012.
All 30 Dow components are solidly in the black, but unfortunately for companies like Zipcar (NAS: ZIP) , that's not the case across broad markets. The car-sharing company reported lower-than-expected revenue in its second quarter and lowered its 2012 forecast range by $18 million, well below analyst expectations. Zipcar also said it signed up fewer members than expected in both the U.S. and United Kingdom. The stock dropped to its lowest level ever, falling a whopping 35% so far today.
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The article Why the Dow Is Flying Today originally appeared on Fool.com.Brendan Byrnes owns no shares of any company mentioned above. The Motley Fool owns shares of Zipcar.Motley Fool newsletter serviceshave recommended buying shares of Zipcar. 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.