Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



2 Stocks Leading the Dow Higher

The Dow Jones Industrial Average (DJINDICES: ^DJI  ) continues its rebound after first-quarter U.S. GDP was revised downward. As of 1:15 p.m. EDT the Dow is up 128 points, or 0.87%, to 14,888. The S&P 500 (SNPINDEX: ^GSPC  ) is up 0.88% to 1,602.

Today's only U.S. economic release was the second and final revision to Q1 GDP. The Department of Commerce reported that GDP grew just 1.8% in the first quarter, down from a previous estimate of 2.4%.

US Real GDP Growth Chart

US Real GDP Growth data by YCharts.

Perversely, this seems to be a positive for the market, as investors believe a weaker-than-expected economy will lead the Federal Reserve to continue its asset purchases for longer than anticipated. Last week, Fed Chairman Ben Bernanke sent the markets tumbling after he said that the economy is strengthening and that the Fed could begin tapering its asset purchases as soon as the end of the year. The market did not believe the economy was as strong as the Fed seemed to think, and today's GDP report gives some credence to that view.

Currently, the Federal Reserve is buying $85 billion worth of long-term assets each month in an effort to hold down rates and spur the economy. The Fed has said it will continue the asset purchases until inflation hits 2% to 2.5%, unemployment falls to 6.5%, or long-term inflation expectations skyrocket. While the continuation of asset purchases is good for the economy, investors should realize that the market is being artificially propped up by the Fed, and if the Fed even thinks about slowing quantitative easing, the market will slide.

Today's Dow leader
Today's Dow leader is Boeing (NYSE: BA  ) , up 2.1% after competitor Bombardier delayed the flight of its new CSeries Jet for the second time, now scheduling it for July. The CSeries, which has only 200 orders so far, is a narrow-body jetliner that will compete with Boeing's 737. Fool analyst Adam Levine-Weinberg recently took an in-depth look at the plane and the challenges it's facing. You can read more about it here.

Second for the Dow today is Microsoft (NASDAQ: MSFT  ) , up 2% after it was upgraded by Morgan Stanley from neutral to overweight. The analyst cited Microsoft's increased focus on its non-PC businesses, as well as the potential for better results in the PC business.

PC sales saw their biggest percentage drop ever in the first quarter, and industry research firm IDC attributed this partly to Windows 8, which was too radical a departure from previous Windows operating systems. There's some hope that PC sales could get better in the third quarter.

Today is the start of Microsoft's three-day Build Developer Conference, where the company has invited developers to come and hear about new changes to its services. At the conference, CEO Steve Ballmer unveiled an update to Windows 8 with a release called Windows 8.1. The updated version of Windows 8 brings back the familiar "Start" button and features some other updates. We'll have to wait and see whether these changes are enough for consumers to change their tune on Windows 8.

It's incredible how much our digital and technological lives are shaped by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2511133, ~/Articles/ArticleHandler.aspx, 9/29/2016 7:45:52 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 9 hours ago Sponsored by:
DOW 18,339.24 110.94 0.61%
S&P 500 2,171.37 11.44 0.53%
NASD 5,318.55 12.84 0.24%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/28/2016 5:27 PM
^DJI $18339.24 Up +110.94 +0.61%
^GSPC $2171.37 Up +11.44 +0.53%
S&P 500 INDEX CAPS Rating: No stars
BA $132.23 Up +0.91 +0.69%
Boeing CAPS Rating: ****
MSFT $58.03 Up +0.08 +0.14%
Microsoft CAPS Rating: ****