| Report | Period | Result | Previous |
|---|---|---|---|
| Consumer Sentiment | May | 83.7 | 76.4 |
| Leading Indicators | April | 0.6% | (0.1%) |
The big surprise today was consumer sentiment, which rose by 7.3 points to 83.7 where analysts had expected a slight rise to 77.5. Consumer sentiment is likely gaining on the steadily rising market and falling gasoline prices.
The second release today was the Conference Board’s Leading Economic Index, which rose by 0.6% to 95, whereas analysts had expected a 0.3% rise. The index is made up of 10 indicators and is designed to signal peaks and troughs in the business cycle.
The biggest factor moving the index is the large rise in building permits to a seasonally adjusted 1.02 million from 890,000 last month. Further, the spread between 10-year Treasury bond yields and the federal funds rate fell to 1.61. The continued rise in the leading economic indicators bodes well for the economy. Investors should remember, however, that the economy and the stock market are two different things, and the market can get ahead of the economy.
Today’s Dow leader
Today’s Dow leader is The Boeing Company (NYSE:BA), up 2.3%. The Boeing Company (NYSE:BA)’s stock took a small hit earlier this year when the FAA grounded its 787 Dreamliner due to problems with its lithium batteries. The company announced on Tuesday that it had resumed deliveries of the plane. The Boeing Company (NYSE:BA)’s stock has been on a tear, up 31% since it first became apparent three months ago that the company would be able to work through this problem. Even after its recent run-up, some investors still think The Boeing Company (NYSE:BA) stock is attractive. Fool contributor Daniel Miller recently detailed two reasons to buy Boeing stock now.
Second for the Dow today is JPMorgan Chase & Co. (NYSE:JPM), up 1.8%. Bank stocks have been on a tear this week after hedge fund manager David Tepper went on CNBC and said he was bullish on Citigroup Inc (NYSE:C), JPMorgan Chase & Co. (NYSE:JPM), and the economy in general. Next Tuesday is a big day for the bank. The company is holding its annual meeting, where investors will vote on a proposal to separate the CEO and chairman roles, both of which are now held by Jamie Dimon. Some investors are worried that Dimon will leave the bank if the measure is passed. Analysts and pundits have been raising concern over the possibility, with some saying the stock will drop 10% if he leaves. Dimon is a great banking CEO, but if he leaves and the stock drops, it would be a wonderful opportunity to get the bank at a cheap price.
Dan Dzombak can be found on Twitter @DanDzombak or on his Facebook page, DanDzombak. He has no position in any stocks mentioned. The Motley Fool owns shares of JPMorgan Chase & Co..
