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.
In recent weeks, U.S. economic data has painted a rosy picture of the future for domestic growth. Yet today, that positive view got cold water thrown in its face, as employment figures showed that employers didn't produce as many jobs as economists had expected. Even though the unemployment rate fell to 7.3%, the reason had more to do with people giving up and dropping out of the labor force entirely. After spending much of the day in positive territory, the Dow Jones Industrials (DJINDICES:^DJI) finally succumbed to a small loss of 15 points on the day, even as broader market measures finished near the break-even point.
Hewlett-Packard (NYSE:HPQ) led the Dow higher with a gain of 1.4% today, even in the face of reports that rival Lenovo is looking to take over the top spot in the PC industry in Europe within the next two years. As long as HP can successfully find ways to diversify its technology business to concentrate on non-PC-related product lines, investors appear increasingly willing to see the company abandon the PC space slowly as part of its broader turnaround strategy.
JPMorgan Chase (NYSE:JPM) climbed 0.9% as bond yields fell back slightly after having touched the 3% level yesterday. The bank might also benefit from a response from the Federal Energy Regulatory Commission that commented favorably on the $410 million settlement it reached with JPMorgan. In resolving a dispute over alleged actions in the Michigan and California power markets to ensure it would receive high rates, the FERC's chairman noted that accepting a settlement was better than going through the uncertainty of litigation. Still, JPMorgan could still face charges for obstruction in connection with the investigation.
Finally, Alcoa (NYSE:AA) rose 0.6%. The Chinese government will reportedly try to get its domestic aluminum producers to expand in global markets rather than within China, which could create more competition for Alcoa. Yet, analysts are skeptical that Chinese aluminum companies will actually follow through on the directive, given the poor conditions in the aluminum market worldwide. In fact, Chinalco (NYSE:ACH) actually suspended a Malaysian aluminum smelter project earlier this week, and it's likely that the same oversupply woes that prompted the suspension could keep it, and other producers, from making big moves to increase supply further.