March has been good to blue-chip stocks. Since the beginning of the month, the Dow Jones Industrial Average (DJINDICES:^DJI) has closed higher in every trading session. Assuming it does so again today, that will make it 10 straight days of gains. According to Yahoo! Finance, that adds up to the Dow's longest winning streak since 1996. As of 2:55 p.m. EDT, the Dow is up 60 points, or 0.4%.
Today's rally was fueled by news that the employment picture is continuing to improve. The Department of Labor reported this morning that the number of Americans filing for unemployment benefits last week fell by 10,000 to a seasonally adjusted 332,000. The median estimate of economist surveyed by Bloomberg predicted an increase to 350,000. According to The Wall Street Journal, it's generally held among economists that the labor market is improving when claims are below 400,000.
In terms of individual stocks, technology giants Hewlett-Packard (NYSE:HPQ) and IBM (NYSE:IBM) are leading the Dow higher in afternoon trading, up 2% and 1.6%, respectively. As my colleague Dan Dzombak noted earlier, the British Serious Fraud Office recently opened an investigation into HP's claims that U.K.-based Autonomy defrauded HP into acquiring the software company. Meanwhile, as fellow Fool Jessica Alling pointed out, IBM is riding the waves of positive publicity related to its work for the city of Boston. In addition, IBM's strong presence in cloud computing and data analytics has positioned it well to exploit the opportunities that will inevitably spring up in the sector.
Heading lower, alternatively, are shares of retailing giants Wal-Mart (NYSE:WMT) and Home Depot (NYSE:HD). Because there doesn't seem to be a specific impetus for either of these companies being down today, it's possible that they're suffering by association with the likes of J. C. Penney and Sears, two failing industry giants. As three of our top analysts discussed earlier today, the former is hanging to life by a thread, while the latter is doing only marginally better.
Beyond this, there's also reason to believe that both of these companies are somewhat countercyclical -- meaning that when things are generally going good, they perform worse. Here's what Fool Morgan Housel had to say about this last month:
Wal-Mart is a peculiar company in that its selling point -- insanely low prices -- gains value when the economy is weak. Families who in normal times shop where it's most convenient flock to Wal-Mart when the economy sours. As the economy was falling apart in early 2009, CEO Mike Duke noted on a conference call: "Our company is stronger than ever because we deliver price leadership and value and help our customers save money so they can live better."
But that can go the other way. When the economy recovers, Wal-Mart sales might take a hit as consumers gain confidence and become less price-conscious."
And the same, by the way, could be said about Home Depot, which relies to a certain extent on people making home improvements themselves, as opposed to paying more to have someone else do it -- the implication being, of course, that professionals may procure their supplies elsewhere.
With this in mind, it isn't such a stretch of the imagination to conclude that the positive jobs figures released by the Department of Labor today are paradoxically working against both of these stocks.
Finally, I would be remiss not to mention the news concerning the Dow's banking stocks, JPMorgan Chase and Bank of America. After they passed the Federal Reserve-administered stress tests last week, many bank investors have been waiting to hear whether or not they'll be allowed by regulators to increase their dividends and/or share buyback programs. Well, we'll find out today when the Fed releases the results of its comprehensive capital analysis and review, or CCAR, at 4:30 p.m. EDT. Click here to see our predictions for JPMorgan, and here for our expectations for B of A.