The Dow Jones Industrial Average (^DJI 0.56%) has made substantial gains following some mixed economic reports. As of 1:15 p.m. EDT the Dow is up 83 points, or 0.58%, to 14,531. The S&P 500 (^GSPC -0.88%) is up 0.51% points to 1,568.
There were four U.S. economic releases today.
|
Report |
Period |
Result |
Previous |
|---|---|---|---|
|
Durable-goods orders |
February |
5.7% |
(3.8%) |
|
Durable goods ex-transportation |
February |
(0.5%) |
2.9% |
|
Case-Shiller home price index |
January |
0.1% |
0.2% |
|
Consumer confidence |
March |
59.7 |
68 |
|
New-home sales |
February |
411,000 |
431,000 |
While the Case-Shiller home price index is reflective of a strengthening housing market, it's a bit worrisome that consumer confidence, durable goods excluding transportation, and new-home sales were all down. Consumer confidence fell from 68 in February to 59.7 in March over concerns about the sequester. While this is just a survey of consumers' opinions, it often is a leading indicator for retail sales. If retail sales follow consumer confidence downward, it will be bad news for the U.S. economy, 70% of which is based on consumer sales.
Durable goods
Seasonally adjusted durable-goods orders were up 5.7% in February, beating analyst expectations of a 4.6% rise. This was led by strength in the transportation market, particularly in aircraft, where new orders jumped by 22%. Orders for aircraft are volatile and can move the results of durable-goods orders substantially. If you exclude transportation, seasonally adjusted durable-goods orders were down 0.5% in February.
Housing
The Case-Shiller composite 20-home price index was up 0.1% in January, marking an 8.1% rise over the past 12 months. While prices were up, new-home sales dropped in February to a seasonally adjusted annual rate of 411,000. That may be down from January and below analyst expectations, but that level is still high relative to the past few years. Housing was a strong point for the economy in 2012. Hopefully that will continue in 2013.
US New Single Family Houses Sold data by YCharts.
Today's Dow leaders
Today's Dow leader is Boeing (BA -0.24%), up 2%. Yesterday Boeing completed its first test flight of the 787 Dreamliner with an updated lithium battery system since the jet was grounded on Jan. 16 by the FAA. Once all tests are completed to both U.S. and Japanese regulators' satisfaction, the company will update the battery systems in the 50 Dreamliners that have already been delivered.
This is embarrassing for Boeing in the short run, but as I've said throughout this ordeal, the Dreamliner's problems are being overblown by the press and will be a minor blip in the 30- to 50-year future of the aircraft.
Intel (INTC -2.40%) is also up 2%, though there's a lack of noteworthy news on the company. Intel shares have been flat this year as the chip maker works to become a major force in the mobile-chip market. After a lackluster 2012, Intel wound up on the 2013 Dogs of the Dow with a dividend yield of 4.36%. While Intel has its work cut out for it, there's a lot to like about it, including its dominant position in the PC chip market and its 4.2% dividend yield
Third for the Dow today is Hewlett-Packard (HPQ 0.69%) up 1.6% on no real news. HP has rocketed up 65% so far this year after investors pushed it down too far in 2012. In fact, the stock fell so far that it, too, made the 2013 Dogs of the Dow with its then-dividend yield of 3.72%. After this year's share price gains and last week's announcement of a 10% boost to the dividend, the stock has a forward yield of 2.5%.
