Before we get into some earnings numbers today, let's take a look at some of the economic data that was released today. The Department of Commerce said that housing starts surged by 12.1% last month to an annual rate of 954,000 units. While this number is extremely volatile and often revised -- as in November, when it was lowered from 861,000 to 851,000 -- the number of permits for home construction edged higher by a 903,000-unit rate, which was the fastest since July of 2008.
In addition to the improved housing numbers, the number of first-time unemployment claims decreased in the most recent reading. The previous number of claims was 372,000, but this past week that fell to 335,000 claims. Most economists expected 370,000, so the drop of 37,000 claims was a great surprise.
Due to the rather positive economic data and a few solid earnings reports released this morning, as of 12:55 p.m. EST the Dow Jones Industrial Average (DJINDICES:^DJI) is up 92 points, or 0.68% to 13,603. Only six of the index's 30 components are trading lower so far, and three of the biggest losers are Bank of America (NYSE:BAC), JPMorgan Chase (NYSE:JPM), and Boeing (NYSE:BA).
So why are they down?
Shares of Bank of America are trading down by 3.9%, making it the Dow's biggest loser of the day. The fall comes after the company announced its quarterly earnings this morning, posting net income of only $367 million. This resulted in earnings per share of $0.03. During the same quarter last year, Bank of America posted net income of $1.6 billion, but after the bank paid roughly $4.7 billion in settlement claims with Fannie Mae and U.S. bank regulators, it would have been nearly impossible to match that number this year. Although the settlements hurt now, the sooner B of A pays the fines and moves on, the better off shareholders will be.
Shares of JPMorgan Chase are down 0.8% on a bad day for the banking industry as a whole. Although JPMorgan posted earnings yesterday that, like Bank of America's, were not terrible, JPMorgan has a number of issues it still needs to clean up before most investors have their full confidence restored.
Shares of Boeing are down 0.28% today after it was announced late in the day yesterday that the company's fleet of 787 Dreamliners has been deemed unsafe for flight at this time by the Federal Aviation Administration and has been grounded until further review. Just yesterday, Japan's two largest airlines, which operate a number of the 787 jets, voluntarily grounded their Dreamliner fleets after one plane made an emergency landing due to an alarm from the aircraft's lithium batteries. Just last week, a 787 in Boston had a fire in the battery storage compartment. This is a major blow for Boeing, and it is unclear how long the planes will be grounded and what the full costs of this problem will amount to.