Dow Gains on Hopes for Cyprus
A day after the Dow Jones Industrial Average had its worst day this month, it reversed the damage, gaining 91 points, or 0.6%. For the week, the blue chips finished down two points.
Today's gain came despite continued uncertainty in Cyprus, which had sent the Dow into the red in two of this week's sessions. Late this afternoon, the parliament passed part of the bailout measures, but delayed a vote on the controversial bank deposit tax, which would take 22% to 25% of uninsured deposits over 100,000 euros from one of the country's struggling banks. The European Central Bank had imposed a deadline for a decision by Monday, and Cyprus's answer remains unclear.
Investors may have been optimistic that a deal would be reached, assured by the partial acceptance. A strong earnings report from Nike may have also boosted confidence in the American consumer, as the athletic-apparel powerhouse saw North American sales increase 18% in the quarter. Shares finished 11% higher.
Hewlett-Packard led all Dow components today, gaining 3.2%. Today's rise comes after a 2.6% drop yesterday, and may just be a rubber band reaction. HP raised its dividend 10% at its shareholder meeting on Wednesday, and its board faced some harsh criticism, as three of the 11 members were nearly voted out. Shares of the PC maker continue to be on a strong upward swing after the Autonomy debacle, having doubled since then.
JPMorgan Chase CEO Jamie Dimon, whose actions have been scrutinized over the last year following the "London Whale" trading loss of $6.2 billion, received a vote of confidence from his board today. The overseers said it "strongly endorses" keeping Dimon as both chairman and chief executive. Some investors had called for a separation of the roles, which give Dimon inordinate power over the nation's No. 1 bank. A recent Senate report was also critical of Dimon, who was paid $18.7 million, filings today show, a 19% drop from the year before. In addition, the bank reported it clawed back over $100 million in compensation related to the $6.2 billion loss.
Finally, UnitedHealth was the Dow's biggest loser today, falling 1.1%. No company-specific news came out today, but rival Humana was downgraded on concerns about cuts in Medicare Advantage payouts. UnitedHealth has underperformed this year on concerns about Obamacare, as shares are essentially flat while the Dow has gained 10.6%. A final decision on Medicare Advantage rates will be announced on April 1.
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The article Dow Gains on Hopes for Cyprus originally appeared on Fool.com.Fool contributor Jeremy Bowman owns shares of Nike. The Motley Fool recommends Nike and UnitedHealth Group. The Motley Fool owns shares of JPMorgan Chase & Co. and Nike. 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.
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