What happened

Shares of Colgate-Palmolive (CL -0.42%) gained 5% on March 4, riding a resurgent stock market that's up huge today. The S&P 500 and Dow Jones Industrial Average were up more than 4% on the day.

So what

Two things are happening that have investors favoring Colgate-Palmolive. First, the stock market is surging as investors become more optimistic that global efforts to contain the COVID-19 coronavirus epidemic will pay off with reduced economic losses.

Man in a business suit forcing line on a chart to go upward

Image source: Getty Images.

Many who follow the markets are also saying today's big run higher is a positive reaction to former U.S. Vice President Joe Biden's big day at the polls on Super Tuesday. Biden's stances as a moderate are generally viewed as more favorable to the markets than that of Bernie Sanders, the self-proclaimed Democratic Socialist whose political agenda could impact the private sector.

In addition to the two rather vague "markets are optimistic" aspects of today's gain, it's a near-certainty that the U.S. Federal Reserve's somewhat surprising decision to slash the benchmark Fed funds rate is helping drive Colgate-Palmolive's stock price higher. The company is well-established as a Dividend Aristocrat, having raised its payout every year for almost 60 years straight, and with interest rates now at some of the lowest levels in history, plenty of yield-focused investors are flocking to stocks like this one with a record of payout growth.

Now what

The stock has gained more than 11% this week already, and proved to hold up much better than many stocks over the past few weeks when the market went into free fall. Colgate-Palmolive shares are about break-even since Feb. 19, while the S&P 500 and Dow are still down almost 8%.

For investors looking for either stability or a reliable dividend, Colgate-Palmolive is likely to remain a stock they flock to. The market is incredibly volatile now as COVID-19's impact on the global economy remains unclear. Today's big surge was on optimism, not on any material improvement in the situation; the spread of the novel coronavirus is still accelerating at this point, and we won't have enough data to measure its global economic impact for months to come.

If you're looking for a dependable yield and a stock that will likely be less volatile (and has the business prospects to hold up if we do see a global recession caused by COVID-19) then Colgate-Palmolive is worth a look. But if it's long-term market beating returns you're looking for, there are better dividend stocks to buy.