The markets wasted no time getting October off to a fast start. Less than three hours into the first trading session of the month, the Dow Jones Industrial Average (INDEX: ^DJI) is already up nearly 150 points.
The impetus for today's move was an upbeat report showing that domestic manufacturing is faring better than expected. The Institute for Supply Management's purchasing managers' index rose to 51.5 for the month of September. Anything above 50 indicates economic expansion, as opposed to contraction.
This was particularly notable because economists had predicted that the figure would suggest a fourth consecutive month of manufacturing declines. The same reading for August was 49.6, and the consensus estimate for September was 49.7. Gus Faucher, a senior economist at PNC Financial, told Bloomberg: "This report removes some of the concern that manufacturing is contracting [even though] we're definitely seeing slowing growth."
Financial stocks led the Dow's climb, with Bank of America (NYSE:BAC), American Express (NYSE:AXP), and JPMorgan Chase (NYSE:JPM) all up more than 2% in intraday trading. If the economy gains traction, institutions that lend money to businesses will be among the first to see the benefit. This is one of the reasons our new in-depth report on Bank of America predicts that the nation's second-largest bank could "double or triple over the next five years." To read more about this, simply click here.
The remainder of the week is chock-full of potentially market-shaking events. As my colleague Alex Dumortier noted earlier today, many of the world's central banks have meetings and/or announcements scheduled throughout the week to assess interest rates and monetary policy. Among others, Fed Chairman Ben Bernanke will be answering questions about the economy at an economic forum this afternoon, and on Thursday the Fed releases the minutes of its most recent Federal Open Market Committee meeting. In addition, as it's the first week of October, employment figures for the month of September will be released on Friday.
Despite what's happening in the short term, I believe markets are due for a correction. The situation in Europe remains dire, economic figures from China continue to deteriorate, and the situation here on the home front looks little better, despite today's positive news. It's for this reason that the world's smartest investors are sticking to low-beta dividend stocks like the ones identified in our popular free report about three Dow stocks dividend investors need. To download this free report instantly, click here now.
Fool contributor John Maxfield owns shares of Bank of America. The Motley Fool owns shares of JPMorgan Chase and Bank of America. Motley Fool newsletter services have recommended creating a write covered strangle position in American Express. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.