The Dow seems to be in an all-or-nothing mood lately. After yesterday's huge losses, which extended Mr. Market's losing streak to five days, the Dow Jones Industrial Average
All eyes are on Alcoa
While the news is undoubtedly the Dow's biggest catalyst for today, it could have been bigger. The company has the second-lowest weighting on the Dow at only 0.55%. That means the index is likely trading higher on general enthusiasm about the beat more than anything else.
Of course we aren't out of the woods yet. Despite falling 5.1% today, the Volatility Index
Keep an eye particularly on the elections in Greece and France to see how tensions in the continent play out. While they seem to have subsided a bit for now, with Italy and Spain showing significant weakness, and France and Germany continuing to be the relatively stronger nations (though even Germany couldn't sell all its 10-year bonds recently), they could froth up again and send markets on another roller-coaster ride.
We've got additional uncertainty on these shores as well. With gas prices heading higher, job growth slowing, and the Fed no longer open to additional quantitative easing, I wouldn't be surprised to see a bit more market easing in the weeks ahead.
The forest from the trees
Putting everything in perspective, though, the broad markets are still up quite a bit for the year, and a small pullback isn't the worst thing. Financial heavies Bank of America
How to play it
If there's one thing to be taken from today's news it's that earnings matter. Alcoa, despite a small weighting on the index, is still sending the Dow higher today. To get a jump on the five stocks investors need to watch this earnings season, you can click here now. Our chief investment officer and some top analysts all agree these are the ones you don't want to miss.
Austin Smith owns no shares of the companies mentioned here. The Motley Fool has a disclosure policy. We Fools may not 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.