Please ensure Javascript is enabled for purposes of website accessibility

Auto Sales Rev Up Dow

By Jeremy Bowman - Updated Nov 17, 2016 at 4:20PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The blue chips gained nearly 100 points on strong vehicle sales and easing concerns about Syria.

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

Boosted by strong reports from automakers and easing fears about Syria, the Dow Jones Industrial Average (^DJI 0.09%) finished up 97 points or 0.7% today.

President Obama spoke in Stockholm today, insisting that the "red line" on chemical weapons was created by the world, not the United States, as he tried to drum up foreign support for a limited strike against the Syrian regime. Meanwhile, the Senate Foreign Relations approved a restricted attack against Syria, by a vote of 10-7, stipulating that no ground troops would be allowed, and the strikes would be limited to 60 days. Markets seemed to react well to the idea of a contained strike.

Back at home, carmakers reported strong August sales as Ford (F 3.14%) and General Motors (GM 4.16%) jumped 3.5% and 5% respectively, and all of the "Big 3" reported double-digit year-over-year increase. GM saw its best month since before the financial crisis, and the reports, which are the earliest indicator of August spending, indicate that consumer demand continues to be strong as vehicles make up about 25% of retail sales. In other economic news, the July trade deficit expanded to $39.1 billion, above expectations of $38.2 billion, and the Federal Reserve's Beige Book economic assessment showed moderate growth in most of the country with consumer spending and the housing market improving.

Microsoft (MSFT -0.92%) was the worst performer on the Dow for the second day in a row, falling 2.2% after receiving a downgrade from Morgan Stanley following its purchase of Nokia's handset division. The investment bank dropped its rating on Microsoft to hold, saying executing the handset integration may be difficult. Microsoft hopes to reach 15% market share in the smartphone industry by 2018, up from 5% today, which could prove difficult, as there are a number of better-positioned competitors and the industry is maturing, meaning major innovations are likely to be less frequent.

Fellow tech heavyweight, Intel (INTC -0.03%) was the Dow's biggest gainer today, moving up 2.6%, after it introduced a new chip, which it calls the Avoton, for microservers. Intel claims the chips run six times faster than its predecessors, and with the company struggling for a foothold as PC sales decline, investors were happy to see it homing in a new microserver market.

Fool contributor Jeremy Bowman owns shares of General Motors. The Motley Fool recommends Ford, General Motors, and Intel and owns shares of Apache, Ford, Intel, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Dow Jones Industrial Average (Price Return) Stock Quote
Dow Jones Industrial Average (Price Return)
$32,832.54 (0.09%) $29.07
Intel Corporation Stock Quote
Intel Corporation
$35.38 (-0.03%) $0.01
Microsoft Corporation Stock Quote
Microsoft Corporation
$280.32 (-0.92%) $-2.59
Ford Motor Company Stock Quote
Ford Motor Company
$15.78 (3.14%) $0.48
General Motors Company Stock Quote
General Motors Company
$37.56 (4.16%) $1.50

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/09/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.