After spending nearly the entire day down, with the markets reacting to worse-than-expected unemployment numbers and unchanged GDP data, the Dow Jones Industrial Average
|Dow Jones Industrial Average||+19.61 [0.15%]||13,145.82|
Two key economic reports came out at 8:30 this morning. We'll start with the GDP numbers, which the Commerce Department releases one month after the close of the quarter and then updates the numbers twice more. Today's report was the second revision of the original report, which had shown 3% growth. Analysts were expecting a revision upward to 3.2%; however, the Commerce Department left the number unchanged at 3%.
The big news this morning was from the Department of Labor, which reported that unemployment claims fell from 364,000 to a seasonally adjusted 359,000 last week. However, economists had expected seasonally adjusted claims of 345,000, and the market headed down on the news. While the claims number is the best we've seen since April 2008, it still points to a very slowly recovering economy. Investors were hoping for much better, and the Dow opened down 60 points and stayed there for most of the day.
The tide slowly turned around 2 p.m., however, and by 3:20 the index was at breakeven for the day. Pundits suggested that the upward move was the result of end-of-quarter action from mutual fund managers who were readjusting their portfolios. Fund managers only have to report their holdings once a quarter, and they're frequently accused of window-dressing their portfolios at quarter's end, shifting their holdings around to show a portfolio that looks better than the results they really delivered. I'm not sure that's what happened here, but it's as good a guess as any.
Bank of America fell 2.26% on the day to $9.53. The Financial Select Sector ETF
The best approach
If you only checked yesterday's close and today's, you wouldn't have thought there was any change. Watching the broad market each day is exciting, gut-wrenching, and stressful, but investing doesn't have to be. If you're in the mood to pick up a few great companies to buy for the long term, The Motley Fool has created a brand-new free report: "3 Stocks That Will Help You Retire Rich." It features three stocks to help you build a smarter retirement portfolio. Get access to the report and find out the name of these three companies. The report is free but won't be forever, so check it out today.
Dan Dzombak owns shares of Bank of America, but he holds no other position in any company mentioned. Like his Facebook page to follow his investing articles. The Motley Fool owns shares of Bank of America. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.