Why not a Single Dow Stock Is up Today

The Dow is down despite some relatively positive U.S. economic releases, but the fiscal cliff deadline looms closer and Congress appears to be nowhere closer to getting a deal done. At the halfway point of the trading day the Dow Jones Industrial Average (DJINDICES: ^DJI  ) was down 114 points (-0.87%) to 13,000. The S&P 500 (SNPINDEX: ^GSPC  ) was down 14 points (-1.00%) to 1,406.

This morning there were three U.S. economic releases:

Report

Period

Actual

Previous

Weekly New Unemployment Claims

12/16-12/22

350,000

362,000

Consumer Confidence

December

65.1

71.5

New Home Sales

November

377,000

361,000

Source: Marketwatch U.S. Economic Calendar

The first economic release this morning came from the Department of Labor, which reported that weekly new unemployment claims fell by 12,000 to 350,000. That was better than analysts' expectations of a minor drop to 360,000. This week's drop puts the one-month average at 356,750, the lowest level since March 2008. While the weekly claims can fluctuate greatly, the four-week average really has not been moved from the 360,000-370,000 range in 2012, signifying a stable but not improving jobs market.

US Initial Claims for Unemployment Insurance Chart

US Initial Claims for Unemployment Insurance data by YCharts

The second economic release was the Conference Board's consumer confidence index, which came in way below analyst expectations. The consumer confidence index dropped to 65.1, down from last month's 71.5, and below analyst expectations of 70.0. Consumer confidence in the short term is being crushed by worries about Congress taking the U.S. over the fiscal cliff, while confidence in current conditions has been slowly improving.

Lastly, the Department of Commerce reported that new home sales rose to a seasonally adjusted annual rate of 377,000 in November. That's up from October's 361,000, though slightly below analyst expectations of a rate of 380,000. The housing market has been slowly regaining strength this year; it will likely continue that growing strength unless Congress lets the U.S. go over the fiscal cliff.

With that said, in fiscal cliff news there is no good news to report. Senate Majority Leader Harry Reid said talks were stalling; he would like the House of Representatives to pass a bill first. On the other side of Congress, House Majority Leader John Boehner would like the Senate to pass a bill first. Hopefully Congress gets its act together after Christmas and doesn't take the U.S. economy over the edge of the fiscal cliff. The Motley Fool has created a special page that will be updated with all of our latest fiscal cliff coverage to help cut through the daily noise and give you only the information and analysis you need as an investor. Head on over for everything you need to know about fiscal cliff 2012.

With mixed news about the economy and bad news about the fiscal cliff negotiations, it's no surprise that the market is down.

Today's Dow leaders down
Financial stocks, with their health largely dependent on the economy, are leading the Dow down today. Bank of America (NYSE: BAC  ) , JPMorgan Chase (NYSE: JPM  ) , and American Express (NYSE: AXP  ) are the financials leading the Dow down, each down roughly 2%. The industry has been recovering slowly, you can see the progress in a recently compiled article on the FDIC's Quarterly Banking Profile. Some investors believe the banking industry has turned the corner. Well-known banking analyst Meredith Whitney recently called out Bank of America as well as Citigroup and Discover Financial as big investment opportunities.

Assuming Congress doesn't kill the economy, Whitney may be right. To learn more about the most-talked-about bank out there, check out our in-depth company report on Bank of America. The report details Bank of America's prospects, including three reasons to buy and three reasons to sell. Just click here to get access.


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