If stock market returns truly represented the health of the entire economy, we'd all be sitting pretty right now. After posting triple-digit gains today, the Dow Jones Industrial Average (DJINDICES:^DJI) sits 20% higher than it did to begin the year. Not shabby for seven months' time!
Central banks in the U.S. and Europe are maintaining low interest rates to encourage growth, a strategy that has helped send blue chips up nearly 140% from 2009 lows. Meanwhile, the unemployment rate remains at 7.6% in a recovery that's been slow to generate jobs growth. That said, corporate America is doing just fine, and the Dow roared 128 points, or 0.8%, higher, ending at 15,628.
American Express (NYSE:AXP) rallied 2.5%, tops in the Dow, as rival MasterCard hit an all-time high following a robust quarter of profits. This helps reaffirm a trend in consumer spending, which can be summed up in just two words: more plastic. American Express reported an 8% increase in transaction volume last quarter, while MasterCard and Visa both saw volumes rise by double digits.
Bank of America (NYSE:BAC) tacked on 2.4% Thursday, helping to make the financial sector the second-biggest gainer in the market. The Charlotte-based bank, which has been working feverishly to settle legal battles in the past few years, asked a federal judge today not to classify one lawsuit against it as a class action case. If heeded, B of A's plea should be advantageous for the bank and its shareholders.
PC-maker Hewlett-Packard (NYSE:HPQ) ended as a third big gainer, adding 2.1% Thursday. The stock has certainly done its part to boost the Dow's returns this year, posting 84% gains thus far. It remains to be seen how concentrating more efforts on its enterprise business, as the PC market slowly wanes, will play out, but for now, HP is still squeezing what it can out of its PC presence, and the back-to-school season will be closely watched by investors.
Lastly, Exxon Mobil (NYSE:XOM) shed 1.1%, ending as one of just five blue chip decliners. The energy giant reported disappointing second-quarter earnings today, with profits falling 57% from a year earlier. A company-funded report also showed today that the cause of a pipeline breakage in March was the result of small cracks worsening over time -- something that can happen in structures built in the World War II era.