Following a miserable last week for the market, the Dow Jones Industrial Average (INDEX: ^DJI) is headed for a markedly higher close today. As of 2:55 p.m. EST, the blue-chip index is up by 179 points, or 1.4%.
Stocks are responding to two different pieces of macroeconomic news. First, lawmakers seem confident that a deal will be reached to avoid falling off the so-called "fiscal cliff" this January. Speaking at a Buddhist temple in Thailand over the weekend, President Obama said, "I'm confident we can get our fiscal situation dealt with." The statement followed a reportedly constructive meeting on the topic last Friday between the president and Speaker of the House John Boehner.
Second, the National Association of Realtors released data today showing that existing-home sales rose by 2.1% in October over the prior month and 10.9% from the same month a year ago. The median sales price last month came in at $178,600, or 11.1% higher than last year's $160,800. Not surprisingly, financial stocks rallied on the news: Bank of America (NYS: BAC) and JPMorgan Chase (NYS: JPM) , the nation's two largest banks by assets, saw their shares climb by 3.8% and 2.75%, respectively.
Today's best- and worst-performing Dow stocks
All but one of the Dow's 30 stocks are higher today. Hewlett-Packard (NYS: HPQ) is currently leading the charge, up more than 4% in intraday trading. As my colleague Matt Thalman noted earlier today, HP is the worst-performing Dow component year to date, down more than 50% since Jan. 1.
The company has been struggling against declining sales of personal computers -- a fact that has highlighted when competitor Dell (NAS: DELL) reported disappointing third-quarter earnings last week. HP's figures are due out tomorrow. Analysts are expecting the company's earnings per share to decline by 2.6% compared with last year.
Alternatively, shares in Intel (NAS: INTC) are heading lower today following an announcement this morning that CEO Paul Otellini will retire in May. The news came as a surprise, because the chip maker's previous CEOs continued in their positions until they were forced to retire at age 65 under the company's mandatory retirement policy.
While Otellini is only 62 years old, Intel has stated that the decision was completely voluntary and that the board accepted his resignation "with regret." According to a statement released by Otellini: "After almost four decades with the company and eight years as CEO, it's time to move on and transfer Intel's helm to a new generation of leadership. I look forward to working with [chairman of the board Andy Bryant], the board and the management team during the six-month transition period, and to being available as an advisor to management after retiring as CEO."
Intel's shares have struggled all year for the same reason HP's have, as the chip maker counts on the personal-computer market for more than two-thirds of its sales. Since the beginning of 2012, the Intel's share price has fallen by 17%, second only to HP in terms of poor performance among Dow stocks. The one benefit to this is that Intel's stock now yields nearly 4.5%. Further, the company is sitting on a massive amount of cash and cash equivalents that could eventually be used to fund research and development, strategic acquisitions, and/or an increase in the dividend payout.
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The article Why the Dow Is Up 175 Points originally appeared on Fool.com.John Maxfield owns shares of Bank of America. The Motley Fool owns shares of Bank of America, Intel, and JPMorgan Chase & Co. Motley Fool newsletter services recommend Dell and Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.
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