Markets are up across the board this morning as corporate earnings -- specifically Apple's (Nasdaq: AAPL ) -- are bolstering bullish positions. With the Fed releasing a policy statement this afternoon, sentiment could shift substantially during late trading, but no one is anticipating any major policy shifts from Bernanke and Co.
With that in mind, let's take a closer look at how the major indexes are faring today and drill down on a few stocks driving today's action.
Gain / Loss
Gain / Loss %
|Dow Jones Industrial Average (INDEX: ^DJI )
|Nasdaq (INDEX: ^IXIC )
Source: Yahoo! Finance.
The Dow is showing its second straight day of over-half-a-percent gains, but is lagging the other two indexes. Two components just released earnings this morning, and while both handily improved from last year, the results elicited widely different market reactions.
Bad news first: Economic bellwether Caterpillar (NYSE: CAT ) is down 2.8%, far and away the worst-performing Dow stock. That sell-off seems overdone. Sure, revenue came in a little light, but Cat beat on the bottom line, where it saw a 29% increase in net income -- and, most importantly, it raised its guidance. China has slowed down, but Cat anticipates a still-strong 8.5% growth in the Middle Kingdom, and U.S. sales are picking up steam, offsetting weakness in Europe and Latin America.
On the flip side, Boeing (NYSE: BA ) shares are deservedly shooting up 3.9%, as the company is adding to its backlog while increasing its monthly Dreamliner production from 2.5 to 3.5 787s a month during the ramp-up to its goal of 10. The defense side of the business also had a strong showing despite pressure to cut Federal spending, contributing to a 30% increase on the top line and a 58% increase in net income. Boeing is really gaining momentum after a series of Dreamliner setbacks, but the company appears poised to successfully execute its plans.
However, the real story is the Nasdaq popping over 2% thanks to a 10% gain for the world's most valuable company. Real concerns were voiced that Apple would miss its sales targets after there were significant sequential iPhone sales declines for the U.S.'s two largest domestic carriers. Fortunately, the iPhone is increasingly becoming an international story, as global growth pushed sales figures over 35 million units, 5 million greater than most estimates.
Motley Fool technology analyst and Apple expert Eric Bleeker appeared on CNBC before earnings yesterday to pound the table that overseas iPhone sales would lead to Apple surpassing analyst estimates. During Apple's conference call, that opinion was validated, as the company reported more than $7.9 billion in sales to China, enough to make up for decreases in U.S. iPhone sales.
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