Stocks Stagnate as Global Budget Worries Persist
U.S. stock markets are pretty flat today as investors weigh the balance between hope and fear over budgets around the world. The Dow Jones Industrial Average is up just 0.22% as of 3:15 p.m. EST, while the S&P 500 is up 0.08%.
In the U.S., both sides of the political aisle appear to be leaving room for an agreement on the fiscal cliff in coming weeks, which would be good for markets and the economy. But in Italy, where the budget issues are much worse, Prime Minister Mario Monti said he would resign as soon as his budget passes. Italy has cut spending and raised taxes under Monti, which has lowered the country's borrowing costs, but he presides over a country in the second year of a painful recession. The uncertainty in Italy brings more uncertainty to a region that's been struggling for years.
On a company level, Hewlett-Packard jumped 2.4% on rumors that Carl Icahn is building a position in the embattled company. The rumors spread like wildfire on Twitter -- not exactly the most reliable source for news. A stake by Icahn would be interesting, but until it's confirmed, it will be relegated to the rumor mill.
McDonald's shares rose 2.4% after the company reported that comparable-restaurant sales rose 2.4% in November following a decline in October. Overall, sales rose 3.2%.
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Home Depot fell 2% after Bloomberg reported that homebuilders are making most of their money on mortgages, not homebuilding. Despite the report, we're in the midst of a housing recovery, which is definitely a positive for Home Depot. The day-to-day moves may be wild, but this should be one of the long-term winners in housing.
We may see a slow week of trading with little economic or earnings news this week -- which may not be a bad thing. Let's just hope the market's silence isn't interrupted by gridlock in Washington over fiscal issues.
The article Stocks Stagnate as Global Budget Worries Persist originally appeared on Fool.com.Fool contributor Travis Hoium has no positions in the stocks mentioned above. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw. The Motley Fool owns shares of McDonald's. Motley Fool newsletter services recommend The Home Depot and McDonald's. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.