Major Indexes Continue to Climb Despite Weak Economic Data

Home Depot and Ford move higher on positive reports, while Coke falls after a negative report.

Apr 1, 2014 at 1:00PM
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The Institute for Supply Management this morning released its latest manufacturing purchasing managers reading. While economists expected a reading of 54 for March, the actual number was only 53.7, suggesting the economy is slightly weaker than most believe.

But following yesterday's comment from Federal Reserve Chairwoman Janet Yellen that the central bank will continue to stimulate the economy for some time, the market may be rallying today because a mediocre economy means more stimulus for a longer period.

As of 12:45 p.m. EDT, the Dow Jones Industrial Average (DJINDICES:^DJI) was up 60 points, or 0.36%, the S&P 500 had risen 0.4%, and the Nasdaq was higher by 1.1%.


One Dow winner was Home Depot (NYSE:HD), as shares were up 0.7% in early afternoon. The stock received a boost today when UBS included in the home-improvement specialist in a list of the top five favorite retailers investors should be buying today. The other four were Home Depot rival Lowe'sAdvance Auto PartsO'Reilly Automotive, and Tractor Supply. UBS said Home Depot is a buy today because we are moving into the prime home selling season, which should help the retailer as homeowners fix up their properties before they sell and new homeowners remodel properties to meet their tastes. Furthermore, UBS said the National Association of Home Builders Remodeling Market Index, which measures how busy contractors are, was the highest it has been since 2004 during the second half of 2013, at trend many believe will continue.  

One loser within the Dow is Coca-Cola (NYSE:KO), as shares were down nearly a half of a percentage point. The company is continuing yesterday's drop after a Beverage Digest report indicated soda volumes again declined substantially in 2013. The biggest decline was seen with diet sodas, which represent nearly a third of all U.S. soda sales. While regular Coke sales fell 0.5% last year, Diet Coke slipped 6.8%, according to the report. This is a true indication that some consumers are becoming even more health conscious and now just say no to all sodas. While this is a big decline, investors shouldn't sell their Coke stock yet, but first allow the company to continue to diversify its offerings to counteract the soda volume decline.

Outside the Dow, Ford (NYSE:F) shares are up nearly 5% on sales figures for March. Ford sold 244,000 vehicles in the United States last month, up from 236,000 in March 2013. However, year to date the company has still only sold 582,000, down from 598,000 at this point last year. The good news is that vehicle sales seem to be picking up after the terrible January and February. Additionally, Ford said it believes that total U.S. auto sales will hit 16 million at an annualized rate, which many consider to be a very healthy figure for the auto industry.   

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Matt Thalman owns shares of Coca-Cola, Ford, and Home Depot. The Motley Fool recommends Coca-Cola, Ford, and Home Depot. The Motley Fool owns shares of Coca-Cola, Ford, and O'Reilly Automotive and has the following options: long January 2016 $37 calls on Coca-Cola and short January 2016 $37 puts on Coca-Cola. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.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.

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