Stocks fell sharply in early trading after the Senate shot down two bills that would have averted across-the-board spending cuts, but the fall was short-lived. As of 3:25 p.m. EST, the Dow Jones Industrial Average (DJINDICES: ^DJI ) has gained 0.21%, while the S&P 500 (SNPINDEX: ^GSPC ) is up 0.22%, as investors look past the mess in Washington. A stronger-than-expected ISM manufacturing index helped pull the markets up from the early loss. The reading rose to 54.2% in February, up from 53.1% in January and above the 52.5% estimate. This indicates that manufacturers are seeing expansion, and a good reading usually bodes well for the future of employment and the economy.
Shares of Disney (NYSE: DIS ) highlighted a slow-moving day on the Dow, rising 1.3%. The company won a jury verdict on three of four claims in a suit filed by Dish Network. The total verdict was for only $4.85 million -- well below the $153 million Dish originally sought. This is one of many lawsuits between media companies and distributors like cable and satellite providers. Cablevision is challenging the bundling of Viacom's channels to cable networks -- a common practice among media companies. Add it all up, and we're in for a slow unraveling of the cable-controlled monopoly on television programming. Disney is sure to be one of the winners when it's all said and done.
Wal-Mart (NYSE: WMT ) is the other big winner on the Dow, moving 1.3% higher. A Thomson Reuters/University of Michigan index showed that consumer sentiment rose to 77.6 in February from 73.8 in January, which may indicate that consumers are ready to spend again. Wal-Mart was hit last month when a note was leaked from an executive claiming that Wal-Mart was having a terrible month, likely because consumers had less money due to higher payroll taxes. Increase confidence is at least good for the long term.
It also didn't hurt Wal-Mart that competitor Best Buy's quarterly earnings came in ahead of expectations last night. Wal-Mart faces many of the same pressures from online retailers that Best Buy does, so strong results have helped both companies. Best Buy is up 3.2% for the day.
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