Big Banks Pull Dow Higher as Housing Improves
May 30th 2013 3:33PM
Updated May 30th 2013 4:25PM
The day-to-day movements of the stock market can be hard to decipher, and today is a classic head-scratcher. This morning it was reported that the U.S. economy grew just 2.4% in the first quarter, falling short of the previous estimate of 2.5%, while jobless claims rose 10,000 to 354,000 . Still, the Dow Jones Industrial Average is up 0.54% near the end of the trading session, and the S&P 500 has risen 0.75%.
The big banks are leading the charge, with Bank of America up 3% and JPMorgan gaining 2.1%. RealtyTrac said that foreclosure sales fell 18% sequentially in the first quarter and were down 22% from a year ago. This is just the latest sign that housing has recovered, and a drop in foreclosures means Bank of America and JPMorgan are being paid back for loans outstanding.
The National Association of Realtors also said that pending home sales were up 0.3% in April -- another strong sign for housing. It's been a long road to recovery for housing, but data this year has shown strong improvement, and that will continue to drive big banks higher.
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Shares of Disney are down 2.3% after the company hit the headlines for all the wrong reasons. First, a patron at Disney World found a loaded gun on a ride where another patron lost it. Then, a Disneyland employee was charged with possession of a destructive device following a small explosion in Mickey's Toontown on Tuesday. The explosion was reportedly caused by two water bottles filled with dry ice, and early reports say this was a prank.
This isn't good news in the short term for Disney, but in the long term it doesn't change the investment thesis for the stock. Disney is still a well-positioned media company with one of the best assets in the business in ESPN. Today's drop is a blip on the radar and can be seen as a buying opportunity for investors looking to jump in.
The article Big Banks Pull Dow Higher as Housing Improves originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool recommends Walt Disney. The Motley Fool owns shares of Bank of America, JPMorgan Chase, and Walt Disney. 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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