Early trading had the Dow Jones Industrial Average higher about 1.0% to over 12,160, around a 117 point gain. Driving the rise in stocks like Caterpillar (NYSE:CAT) and Kraft Foods (NYSE: KFT) were reports of a French-led “Brady bond” type of rescue package for Greece, improving homes sales from March to April and positive consumer confidence numbers.
Case Schiller numbers, while showing improvement for March to April of this year, were still down from 2011 sales. But stock market investors will take whatever good news they can on the housing market these days.
Leading the Dow with a 2.5% rise in early trading Tuesday was Caterpillar (NYSE: CAT). At abpit $103 a share, Caterpillar is above its 20 day and 200 day moving average. With a relative strength index of around 50, Caterpillar is beneath the 70 mark for being considered overbought.
Kraft Foods (NYSE: KFT) cooked up a 1.2% gain, and the consumer giant is trading around $35. Kraft is nearing its 52 week high of $35.44. Above its 20, 50 and 200 day moving averages, Kraft has a relative strength index of 59.38.
IBM (NYSE: IBM) was also strong, up over $1.30, more than a 0.8%, taking Big Blue close to $170 a share as techs continued in favor after being pounded late last week. Above its 20 day, 50 day and 200 day moving averages, IBM is close to its 52 week high of $172.77. The relative strength index for IBM is over 59.67.
Financials, with JP Morgan (NYSE:JPM) and Bank of America (NYSE:BAC) as the big movers, were the losers in the morning session.
JP Morgan stock was down over 32 cents, more than 0.8%, trading in the $39.50 range. JP Morgan is trading just 13% above its 52 week low. It is also beneath its 20 day, 50 day and 200 day moving averages.
Down about 0.5% percent, Bank of America was near $10.80. Bank of America is just under 4% from its 52 week low so it could be at or near the bottom. With a relative strength index of 44.07, Bank of America is more than 15 percent beneath its 200 day moving average, and slightly below its 20 and 50 day moving averages.
Cisco Systems (NASDAQ: CSCO), down over 0.32%, around 5 cents, was trading in the $15.00 range. More than 22% beneath its 200 day moving average, Cisco has a relative strength index of 35. A relative strength index of 30 is the standard for stock being oversold.
Jonathan Yates does not own any of the stocks mentioned in this article.
