Relax and check out what sent the Dow Jones Industrial Average (DJINDICES:^DJI) up 26 points Monday to start the week.
1. Errors in manufacturing data confuse the Street
Mondays are a drag, but a double-botched economic report spiced things up. The Institute for Supply Management releases a much-followed manufacturing activity report, the result of a survey conducted on business managers. At the end of the day, the report read 55.4, boosting many stocks and helping the S&P 500 reach a record high.
But it was two errors and revisions in the report that entertained and frustrated short-term traders. The report is viewed as a predictor of economic activity -- a positive outlook by business managers means the best sources with boots on the ground in actual factories is feeling good about business. So when the report showed a drop from April to 53 in May, stocks sold down over 0.4%. Then the report was revised up to 56. And then revised again back down to 55.4.
The takeaway is that after winter weather slowed the U.S. economy (remember that Q1 GDP contracted 1%), Wall Street's been eagerly hoping for signs of a spring resurrection like hockey fans before playoff overtime. The positive reading (third time's a charm for ISM) finally gave investors the cheery stock-buying mood we all needed on Monday. The hit in credibility wasn't what the ISM needed, though.
2. Google's investing billions in satellites to expand the Internet
What's Google's Big Next Thing? It's a fleet of 180 low-flying, Internet beaming, mini-satellite dishes. To bring the Internet to remote parts of the world, Google (NASDAQ:GOOG) (NASDAQ:GOOGL) is spending $1 billion to $3 billion on a major satellite project, according to The Wall Street Journal.
Make no mistake -- Google is seeking a way to create more Internet users, because that's the source of its profits. Both Facebook and Google are desperately trying to bring Internet access to untapped markets with balloons, satellites, and plenty of drones.
Journal-reading investors were less than impressed. Google is trying to bring Internet access to hundreds of millions of new people living in under-served areas. But are 35- to 45-year-old Indonesian men living on a boat with their dog the demographic whose attention advertisers crave? Maybe not. Not to mention the regulatory and logistical challenge of orbiting 180 fancy machines. The stock slipped 1.3% on the interesting news.
3. Apple falls during tech conference
The Worldwide Developers Conference, or WWDC, is the golden ticket that San Fran-based techies will sell their sister for. At Apple's (NASDAQ:AAPL) big tech conference Monday, an executive phoned new Apple employee Dr. Dre during the event using a super-cool phone app on his MacBook. The very problem with this year's WWDC was that this phone call was the biggest highlight. They couldn't even use Skype?
The company also unveiled a new operating system at the event that was attended by over 6,000 tech developers, but no new products. The WWDC traditionally gives hints about the next big product unveiling, but so far there's mostly yawns coming from San Francisco. The Apple-maniacs may be having fun, but Wall Street shot Apple stock down 0.7% on the day.
As originally published on MarketSnacks.com