2 Dow Stocks and Lawmakers Fuel Rally

Stocks are mixed in intraday trading as we reach the thick of earnings season and lawmakers in Washington move toward a temporary solution to the debt ceiling. With roughly an hour left in the trading session, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) is up 76 points, or 0.55%.

House votes to suspend the debt ceiling
If you thought the saga in Washington was over when the so-called "fiscal cliff" was (sort of) resolved, think again. At the end of last year, the U.S. government reached its self-imposed debt ceiling, beyond which it legally cannot take on more debt. While the Treasury Department has since used extraordinary measures to make ends meet, the stopgaps are only sustainable through the end of next month.

The good news from today is that the situation appears headed for a resolution -- a temporary one, at least. This morning the U.S. House of Representatives voted overwhelmingly in favor of a bill that will remove the debt ceiling until May 19, at which point you can bet your bottom dollar that lawmakers on both sides of the aisle will be ready for a fight.

According to Republican House Speaker John Boehner: "The premise here is pretty simple. It says that there should be no long-term increase in the debt limit until there's a long-term plan to deal with the fiscal crisis that faces our country."

The measure now heads to the Senate, where Democratic Majority Leader Harry Reid said lawmakers will pass the legislation and send it on to the president for his signature.

Earnings season progresses
Beyond Washington, the biggest news impacting the market has to do with earnings season. A total of five blue-chip companies on the Dow reported their fourth-quarter results yesterday.

The best news came from International Business Machines (NYSE: IBM  ) , which exerts an inordinate 11% influence on the index due to its $200-plus share price. For the final quarter of 2012, the technology and services giant reported earnings per share of $5.39, beating the average analyst estimate of $5.25. Even more promising was its forecast for 2013, in which it sees GAAP earnings growing by 8%.

The earnings release from fast-food chain McDonald's (NYSE: MCD  ) from earlier today is also fueling the Dow's climb. Like IBM, McDonald's beat analyst estimates on the bottom line, earning $1.38 per share compared to the consensus forecast of $1.33 per share. For the year, same-store sales at all locations around the world increased a solid 3.1%, led by 3.3% comps in the United States. This final metric, a central figure in the restaurant and retail industry, comes as a relief to many shareholders. In October, the company reported its first year-over-year monthly decrease in same-store sales since April of 2003.

Looking toward the rest of the week, four Dow companies will report between tomorrow and Friday. Up tomorrow are 3M, AT&T, and Microsoft (NASDAQ: MSFT  ) . The latter has been making headlines of late related to its purported interest in the rumored sale of Dell (UNKNOWN: DELL.DL  ) . According to The Wall Street Journal, the software giant joined discussions with a private-equity company and Dell founder Michael Dell to take the computer maker private. While Microsoft has allegedly "not made a commitment," should the deal go through, its $22 billion price tag would go down in history as one of the largest leveraged buyouts in the technology space.

With respect to earnings, analysts are expecting Microsoft to earn $0.75 per share in the final three months of 2012. The release will also give the world a better idea of how well the company's latest operating system and tablet have been received by a seemingly wary public.

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