Why the Dow Rocketed 227 Points Higher Today

Delta Air Lines, Disney, and J.C. Penney all rally as stocks gain on Ukraine.

Mar 4, 2014 at 6:27PM
Longview

It's funny how quickly talking points come and go on Wall Street. Just yesterday, global stock markets plunged as Russia amassed combat troops in a symbolic effort to threaten further aggression against Ukraine. But with Russian President Vladimir Putin ordering those same troops to go back home earlier today, Putin revealed his bluff -- and to the jovial pleasure of investors across the globe. Will geopolitical concerns about Ukraine be a distant memory to markets in just a few months' time? I hope so, for everyone's sake. The Dow Jones Industrial Average (DJINDICES:^DJI) has already moved on, roaring 227 points higher today, with the 1.4% gain sending the index to 16,395. 

The Dow couldn't have advanced quite so rapidly on Tuesday if it weren't for Walt Disney (NYSE:DIS) stock, which tacked on 2.8%, nearly finishing as the day's best blue chip performer. Disney's outperformance was driven by its unprecedented, brand-spankin'-new agreement with DISH Network, announced last night. The multi-year deal (specific terms weren't disclosed) gives DISH the right to stream content from Disney-owned stations like ABC, ESPN, ESPN2, and of course, the Disney Channel. I applaud both companies for the bold strategy, but Disney especially, because the company began recognizing the looming demise of cable years ago, and continues to adjust distribution deals accordingly. It's official: welcome to the age of streaming!

If J.C. Penney (NYSE:JCP) was a person rather than a company, I'd sure hate to be his physician. Less than a month ago, he appeared to be dying of lupus, a poor fellow living on the streets, disheveled and ignored. Now he's practically the Great Gatsby, gallivanting around town with anyone he chooses. J.C. Penney stock continued its unapologetic upswing today, gaining 4.2%; the stock is now nearly 50% higher than it was just last Wednesday. And what's not to be excited about? Margins and sales are increasing, it started promoting its spring 2014 collection during the Oscars, and S&P upgraded its debt yesterday. Remember: He had lupus just a week ago, old sport!

(Also before you start sending me hate mail, I am aware that J.C. Penney was actually a person. Pardon my phrasing.) 

Finally, Delta Air Lines (NYSE:DAL) shares also stood out in the stock market today, soaring 5.7% and briefly hitting an all-time high. Delta is one of those companies that likes to brag about its performance each month, and it so happens that last month's performance was almost impossible to find fault with. Despite thousands of flight cancellations due to weather patterns with names like Leon, Delta's passenger revenue per available seat mile, an important statistic in the industry, rose by 4% from February 2013. Moving forward, Delta's fuel price is expected to come in about 8% lower than last year's in March, which should beef up the bottom line. 

The $2.2 trillion war for your living room begins now
You know cable's going away. But do you know how to profit? There's $2.2 trillion out there to be had. Currently, cable grabs a big piece of it. That won't last. And when cable falters, three companies are poised to benefit. Click here for their names. Hint: They're not Netflix, Google, and Apple.

John Divine owns shares of Apple and Google and has long January 2015 $10 calls on J.C. Penney. The Motley Fool recommends and owns shares of Apple, Google, Netflix, and Walt Disney. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers