Bank of America Corp (BAC), Wells Fargo & Co (WFC): Dow Jones Industrial Average (.DJI)’s Best Yet to Come?

Page 1 of 2

As the Dow Jones Industrial Average (INDEXDJX:.DJI) begins the third quarter up 155 points as of 11:50 EDT this morning, it has history on its side. Though investors felt some serious turbulence as the first half of the year’s trading came in for a landing, the index and its compatriots still recorded impressive gains — the Dow Jones Industrial Average (INDEXDJX:.DJI) itself up 14%. So if history truly repeats itself, is the index in store for even more soaring in the coming months?

Bank of America Corp (NYSE:BAC)

First of July
Even though investors have an abbreviated trading week due to the Independence Day holiday, they’re wasting no time in capitalizing on some good economic news this morning. Sending the Dow Jones Industrial Average (INDEXDJX:.DJI) over the all-important 15,000 mark, investors were happy to see the ISM manufacturing index beat expectations with an almost two-point jump from May’s reading — the lowest seen in four years. Coming in at 50.9, the June reading gives hope that continued improvements in manufacturing will help support the economic recovery during the second half of the year.

Another report this morning indicated that spending on new residential construction was also on the rise in May, with overall construction spending also up. With private residential construction spending driving the growth in overall spending, the data once again proves the strength and momentum of the housing recovery, an essential piece of the economic recovery.

Though Mr. Market may have been getting used to the negative reaction from investors that these kinds of positive reports were getting in the prior months, investors may be turning a new leaf as the beginning of a new quarter is upon them.

Financials cashing in
Both the good housing news and last week’s report on improving consumer spending numbers have helped the Dow Jones Industrial Average (INDEXDJX:.DJI)’s financial component stocks rebound quickly from last week’s correction. American Express Company (NYSE:AXP) is still riding high, up 2.01% as of this writing, following the news that both personal income and consumer spending were up. Since the company’s largest operations are based on consumer spending, especially in the higher-income demographic, which has enjoyed a faster rebound than other groups, the card-provider is soaring.

While Bank of America Corp (NYSE:BAC), JPMorgan Chase & Co. (NYSE:JPM), and Wells Fargo & Co (NYSE:WFC) all operate credit card divisions for their customers, the housing news this morning is a much bigger boost than the consumer spending data. All three are vying for new mortgage loan activity as the housing market recovers, and though there has been some slowing of refinancing activity due to higher interest rates, all three stand to eventually benefit from those new, normalized rates.

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!