Today, markets balanced encouraging data showing an increase in durable goods orders with the fact that those same data could contribute to a slowdown in quantitative easing. While June orders for automobiles and machinery jumped more than 4%, easily exceeding expectations for the month, Wall Street was hesitant to bid stocks up too much. The more signs of a growing economy manifest themselves, the more likely the Federal Reserve is to ease back on loose money policies. Not quite sure how to feel, the Dow Jones Industrial Average (^DJI +2.85%) tacked on 13 points, or 0.1%, ending at 15,555.
Chevron (CVX 4.29%) led all gainers in the index, adding 1.1% on the third straight month of increasing durable goods orders. With a trend like this establishing itself, Chevron investors took it as a bullish sign, as increasing manufacturing demand is seen as an indication of rising future energy consumption. With Treasury yields also falling today, the company's 3.2% dividend looks more appealing to income investors.
McDonald's (MCD +0.83%), which offers a 3.1% annual payout of its own, gained 0.9% Thursday after a three-day decline following disappointing quarterly results. While its most recent quarter may not have blown anyone away, the company's signature golden arches is one of the most recognized corporate images in the world, and that isn't likely to change anytime soon. While it's true that consumers are increasingly health conscious, the fast-food restaurant is taking steps to cater to that crowd as well while remaining cheap.
Though you'd think today's news about a resurgent industrial environment in the U.S. would boost shares in Caterpillar (CAT +6.49%), a leading provider of manufacturing equipment across the world, the stock actually lost 1.6% Thursday. That's because the company cut its earnings forecast yesterday on dwindling growth in Chinese industry as commodities prices remain low. With 69% of the company's revenue coming from overseas, the health of U.S. industry isn't quite as important for Caterpillar as it is for other blue chips.
Lastly, Microsoft (MSFT +0.55%) shed 1.8% today, despite little in the way of groundbreaking news. Shares have been drifting up and down ever since reporting an abysmal quarter last Friday, when shares fell more than 11%, its largest single-day loss since 2009. Investors are still waiting to see real progress in the mobile device market, a booming area the company has yet to fully take advantage of. Wall Street is also eagerly anticipating the reception of the Xbox One gaming console, set for release in November.
