There are still quite a few long faces on the Dow Jones Industrial Average this morning, though the index is up 48 points, led by credit card companies Visa and American Express . AmEx, having turned in an earnings report showcasing increased customer use during the fourth quarter, is up nearly 5%, while Visa has gained more than 2% at noon EST.
Markets may be feeling some relief from the news that the U.S. Senate finally approved the $1.1 trillion budget bill that will, hopefully, carry the country through September with minimal drama.
Separately, the U.S. Census Bureau announced that new home construction in December was down 9.8% from the previous month, to 999,000. The market, probably expecting wintry weather to take its toll, anticipated a count of about 985,000. Single family housing starts fell 7% from November, while single family completions for December were down 8.2% from the prior month.
Consumer confidence took a hit this month, with the Reuters/University of Michigan Consumer Sentiment Index registering a chilly 80.4 in preliminary figures, compared with December's 82.5 and a much hardier 83.5 expected by analysts. The economic outlook dulled for low- and middle-income families this month, many of whom don't see much headway being made in the employment sector.
American Express and Visa rock the Dow
American Express is riding high today, despite missing slightly on earnings predictions. The credit provider showed fourth-quarter revenue was up 5% year over year, while delivering a rise in return on equity, from 23.1% one year ago to the current 27.8%. Fourth-quarter income topped $1.3 billion, versus $637 million in the year-ago period.
CEO Kenneth Chenault noted an 8% increase in card-holder usage, despite some reports of a less-than-stellar holiday shopping season. Chenault reported satisfying results in cutting costs, thanks to the company's restructuring plan instituted last year.
American Express' glow has spread to Visa, which continues to gain as lunch time approaches.
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The article American Express Roars After Earnings originally appeared on Fool.com.Fool contributor Amanda Alix has no position in any stocks mentioned. The Motley Fool recommends American Express and Visa. The Motley Fool owns shares of Visa. 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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