It's a good day to be an investor today. The Dow Jones Industrial Average (DJINDICES:^DJI) followed up on Monday's gains with a triple-digit session in the green today, closing up 115 points, or 0.9%, to reach highs not seen since October. Twenty-six out of 30 Dow stocks recorded gains, and even the index's laggards couldn't hurt the optimistic rally. Once more, it was the fiscal cliff in full focus during the run.
Washington sends shares up
Stocks shot higher today after House Republicans in Washington, led by Speaker John Boehner, announced they would begin work on constructing a fiscal cliff deal that would preserve low taxes on individuals making incomes less than $1 million annually. While there's no certainty that such a deal can draw bipartisan support, it's nonetheless an important step toward compromise between Republican and Democratic leaders after the two parties have clashed over tax increases and spending cuts.
Wall Street certainly embraced the move today: Financials took the Dow higher, with Bank of America (NYSE:BAC) leading all stocks up as shares gained nearly 3.3%. B of A's been the best performer on the Dow this year, but its comeback from the depths of recession in building up capital positions and investor confidence has strengthened the bank's climb. If the fiscal cliff is averted, B of A looks poised to capitalize on the rebounding housing market in a big way.
Despite having less exposure to the fiscal cliff, tech stocks also had a strong day on the Dow. Shares of much-maligned Hewlett-Packard (NYSE:HPQ) rose more than 2.2%, giving shareholders a much-needed day of gains after the stock's three-month losses of more than 22%. Fellow stocks involved in the declining PC market also managed to record strong gains, with Microsoft (NASDAQ:MSFT) and Intel (NASDAQ:INTC) picking up 1.7% and 1.9%, respectively.
Few stocks saw losses on the day, but General Electric (NYSE:GE) managed to shave its heavy losses of earlier to end the day down just 1.1%. Fellow laggards include Coca-Cola (NYSE:KO), which declined 0.6%, and Home Depot (NYSE:HD), which fell 0.5% despite being well positioned to succeed in the surging housing market. Despite today's slight drop, however, shares of Home Depot are up more than 50% for the year.
Dan Carroll has no positions in the stocks mentioned above. The Motley Fool owns shares of Bank of America, General Electric, Intel, JPMorgan Chase, and Microsoft. Motley Fool newsletter services recommend American Express, Home Depot, Intel, Coca-Cola, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.