After a day of plunging markets, it's always nice to see at least a bit of a bounce. That's what the stock market gave investors early today, as they largely ignored ratings downgrades on bank stocks from Moody's. Some pointed to the European Central Bank's decision to make it easier for banks to use lower-quality collateral to get financing. In addition, some investors were glad to see that Facebook (Nasdaq: FB ) earned a buy rating from Nomura, citing a $40 price target on the stock despite uncertainties about how it will monetize its leading social platform. By around 10:45 a.m. EDT, the Dow Jones (INDEX: ^DJI ) was up 37 points, although it had fallen back from as much as a 75-point gain earlier in the morning.
Among Dow stocks, the banks that were the target of Moody's downgrades avoided big losses. Bank of America (NYSE: BAC ) , whose cut to a rating of Baa2 put it among the two lowest-rated banks of the 15 Moody's looked at, was unchanged after opening significantly higher. JPMorgan Chase (NYSE: JPM ) , which got downgraded to an A2 rating, was actually up 2%, as the news wasn't as bad as some had feared. Many believe that the ratings are more reflective of the banks' past history than their future prospects.
Johnson & Johnson (NYSE: JNJ ) climbed 0.6% despite getting notice from the FDA that regulators wouldn't allow J&J to expand use of its Xarelto blood clot drug as a way to reduce risk of strokes and heart attacks for those suffering from acute coronary syndrome. The company didn't immediately say whether it would try again to seek future FDA approval.
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