With everyone concerned about the economy, you'd think that good news on the employment front would trigger a big rally in stocks. But even after the Labor Department said that the economy had added 200,000 jobs in December, pushing the unemployment rate down to 8.5%, stocks initially dropped sharply.
But apparently, bullish investors saw the light later in the morning. After falling as much as 80 points during the session, the Dow Jones Industrials (INDEX: ^DJI ) recovered most of those losses by midday, with the average down just 22 points to 12,394 as of 12:15 p.m. ET. The S&P 500 was down less than 1 point at 1,280.
General Electric (NYSE: GE ) was one of the Dow's biggest gainers as of noon, with a rise of about 1%. The company, which made the Dogs of the Dow list for 2012 because of its high dividend yield, got a positive analyst recommendation from JPMorgan. The report cited GE's high-margin service business, healthy spending on research and development, and strong presence in growing emerging markets.
The biggest loser in the Dow was Alcoa (NYSE: AA ) , down about 2%. The company announced it would cut smelting capacity by about 12% by closing some of its facilities. But even though aluminum prices are down by more than a quarter from their highest levels last year, analysts don't expect the move to make a big impact on oversupply in the market.
Among sectors, tech stocks were mixed. Intel (Nasdaq: INTC ) fell about half a percent after getting downgraded by Sterne Agee. The analyst cited competition from ARM Holdings, whose rival chips are expected to appear on PCs running an ARM-compatible version of Microsoft's (Nasdaq: MSFT ) Windows 8 operating system. For its part, Microsoft seemed to benefit from the news. It was among the top gainers in the Dow, gaining more than 1%.
Intel is a giant in the PC industry, but it's not the most exciting prospect for mobile technology. Find out which stock is poised to make huge profits in the Motley Fool's latest special report, "The Next Trillion Dollar Revolution." Let me invite you to read it today absolutely free -- but don't put it off or else you might miss out.