What an exciting day to be an investor! All three major indices opened with a quick quarter-point run-up today, then fell down into the red, then shot back up into multiyear record territory. The Dow revisited the 13,000 mark, its highest level since 2008, before dipping back to just under the milestone.
Gain / Loss
Gain / Loss %
|Dow Jones Industrial Average ||+46.13||+0.4%||12,996|
The big news
It'd be impossible to mention today's flirtation with multiyear highs without pointing to the Greek debt deal that's been inked. The plan for a Greek rescue still leaves Athens managing a huge debt burden, but an agreement has been reached. Eurozone finance ministers settled on a $172.1 billion plan that leaves private investors with a 53.5% "haircut" on their principal. This exceeds the 50% markdown that was agreed on in October.
The rock stars
Looking back to U.S. shores, there are a few standouts that also helped the Dow rally to the 13,000 mark; I'm looking at you, Alcoa
- Alcoa is a highly cyclical stock that's particularly sensitive to Europe, so it's no surprise that the aluminum manufacturer is rallying more than 3% on the positive news out of Athens today. The company had a rough 2011, but general investor sentiment is for a strong 2012.
- Bank of America is already the top-performing Dow stock of 2012, and today's 1.9% climb will just make it that much harder for the other components to catch. The impressive year-to-date performance is adding credence to the "Dogs of the Dow" theory, which assumes that the worst-performing Dow stocks of one year often outperform the next. Although many investors may be scared of banking stocks, one Fool analyst thinks otherwise and has looked at Why Bank of America Could Be the Biggest Winner in 2012. Thus far, he's been proved right.
- Caterpillar, another highly cyclical company, is seeing a big run today. The heavy-equipment company is up 1.8% in midafternoon trading, adding to its amazing 29% gain year to date. Caterpillar recently had a blowout quarter on the back of emerging-market growth. If you're optimistic on the global economy in 2012, this is a winner for your books.
It's not all fun and games, though. Wal-Mart
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Austin Smith owns no shares of the companies mentioned here. The Motley Fool owns shares of Wal-Mart Stores and Bank of America. Motley Fool newsletter services have recommended buying shares of Wal-Mart Stores. Motley Fool newsletter services have recommended creating a diagonal call position in Wal-Mart Stores. 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.