Stocks got off to a great start this Thanksgiving week; with the Dow Jones Industrial Average (^DJI 0.67%) and the broader S&P 500 (^GSPC 0.87%) gaining 1.6% and 2%, respectively -- the S&P 500's best daily performance in two months.
The macro view: Partially underpinning today's rally were figures from the National Association of Realtors showing an increase in existing sales that exceeded economists' expectations and the lowest level of inventory relative to current sales activity since February 2006. The housing recovery looks to be under way -- Lowe's (NYSE: LOW) announced third-quarter results this morning that appear to be another piece of confirming evidence.
"And another one gone, and another one gone, another one bites the dust," as Queen's famous lyric goes. Moody's joined S&P in downgrading France 00 one of the eurozone's "core" countries -- from Aaa to Aa1. S&P had already stripped France of its highest rating back in January. I wouldn't expect the announcement to have any material impact on bond or equity markets: The French 10-year bond was yielding 2.07% today, just above the record low 2% it achieved in August. Nevertheless, the downgrade is another reminder of the eurozone's ongoing struggle with the straitjackets of monetary union and austerity.
The micro view: Microprocessor manufacturer and Dow component Intel (INTC 0.61%) announced that its CEO, Paul Otellini, will retire in May. Otellini, 62, has spent nearly four decades at Intel. The announcement was a surprise for the market -- as it was for Intel's directors, when the chief executive told them last Wednesday. The market doesn't like uncertainty, and Intel's stock was the second worst-performer among Dow components today, gaining just 0.3%.
The resulting leadership transition will come at a time when the markets Intel serves are themselves in transition, creating both opportunity and risk for the chipmaker. If you want to find out whether Intel shares are a buy, sell, or hold right now, click here to receive our premium report, which includes 12 months of ongoing coverage.
