July 23rd, 2009
12:52 PM ET

Financial Dispatch: Dow back above 9,000

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Andrew Torgan
CNN Financial News Producer

Corporate earnings are the name of the game on Wall Street this week, and today’s onslaught is giving stocks a lift.

The Dow is back above the 9,000 mark for the fist time in more than six months, thanks to better-than-expected results from components AT&T and 3M.

The Dow and S&P 500 ended lower Wednesday, but the Nasdaq managed an 11th straight session of gains for its longest win streak since September 1996. Better-than-expected results from Apple and others led the tech-heavy average higher.

Ford Posts a Profit

Adding to the overall positive tone to the trading day, Ford Motor Co. reported a surprise net profit of $2.3 billion in the second quarter thanks to efforts to reduce its debt.

But the automaker posted another operating loss during the quarter due to a continued slump in sales. Still, that loss was much smaller than a year ago, when Ford posted a net loss of $8.7 billion. That was the worst quarter in Ford's history.

Ford was also the only American automaker not to file for bankruptcy during the second quarter and it never asked for a government bailout.

Jobless picture cloudy

The number of Americans seeking jobless benefits rose last week, although the numbers were distorted by the timing of auto plant shutdowns.

The Labor Dept. says initial claims for unemployment insurance rose by 30,000 to a seasonally adjusted 554,000 last week - slightly above estimates.

But analysts are again saying that the numbers are skewed. Detroit’s Big Three typically shutter their plants for two weeks in July, but due to the bankruptcies of GM and Chrysler, many closed down in April and May instead.

Meanwhile, the total number of people receiving jobless benefits for one week or more fell by 88,000 to 6.2 million, the lowest level since mid-April. But that’s most likely because a lot of people's benefits have run out.

Homes sales rise, but prices plummet

Sales of previously-owned rose homes rose at a seasonally adjusted annualized rate of 4.89 million in June, up 3.6% compared with the previous month, according to the National Association of Realtors.

Home sales peaked in August 2005 at an annualized rate of more than 7.2 million, but sales have not surpassed the 5 million mark since last September, despite a large number of homes on the market, low mortgage rates, a tax credit for first-time homebuyers and low, low prices.

And the median price for a home sold during the month was just $181,800 - 15.4% lower than 12 months earlier.

Gas prices rise

Gas prices climbed 4-tenths of a cent overnight to $2.465 - the second straight day of increases.

The average price of a gallon of gas is down $1.649 or 40.1 percent from the record high price of $4.114 that AAA reported on July 17, 2008.

The highest gas prices are in Hawaii ($3.161). The cheapest are in South Carolina ($2.227).

Bernanke sends mortgage rates lower

Home mortgage rates ticked lower after Federal Reserve Chairman Ben Bernanke said the central bank will continue to keep interest rates low.

The average 30-year fixed mortgage slipped to 5.55% from 5.58% the week prior, and the 15-year fixed fell to 4.89% from 4.93%, according to the weekly national survey from Bankrate.com.

On Wednesday, Bernanke gave his semi-annual congressional testimony on the state of the economy, saying the central bank will "likely keep interest rates low for an extended period of time."

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Filed under: Andrew Torgan • Finance
soundoff (8 Responses)
  1. earle,florida

    Great news today about Ford Motors,and should be a catalyst, jump-starting (could careless about Cerberus&Chrysler) GM. The Dow above 9k pts. is great,and the Nasdaq's run is very impressive.It's hard to believe that six-months ago the Dow was 6.6k pts.,approx. 2.4k pts.lower than today. Wow! It all seems so surreal,and so long ago. Kinda gives me the creeps,for the one reason that only "Wall Street&The Big Banks" are benefiting,and the economist just seem to be talking up a jobless economy. But,what-ya-gonna-do,nothing, I guess. Yet,it all seems to bring me back to why the country was in a finacial crises in the first place,unexpectivly,and so suddenly (the Alpha,without The Omega),if the US Treasury just bailed out Lehman? Think about it for awhile, and run it through your head afew times,....? Finally, the housing market is a buyers market with no buyers,unless your willing to just give your home away to the banks,via foreclosure,which is another surreal vicissitudes celebrating our times!

    July 23, 2009 at 3:26 pm |
  2. Melissa

    Just another sign that the economy is recovering and what Obama is doing is working.

    Enough, enough already. Stop trolling.

    July 23, 2009 at 3:22 pm |
  3. Mari

    There are plenty of signs that the economy is on the rebound:

    1. Existing home sales are up.

    2. Slowing of unemployment.

    3. AT&T and other big corporations surprising Wall Street with profits! Even Ford's numbers were better than expected!

    4. Here in our state we are seeing signs everywhere that say "HIRING"!

    The naysayers will always be around! And healthcare will be reformed and a bill will be passed!

    Driving this summer on vacation, it seemed that every road, highway, bridge and street were under construction!

    The Obama Stimulus Package is re-building America! We are investing in OUR OWN Nation rather than re-building others!

    July 23, 2009 at 2:56 pm |
  4. Joanne R. Pacicca

    The Dow is up, but for how long? Before we hit the skids, we were up to 13,500...or am I mistaken?

    In any event, we need to manufacture products that the world wants, that they world cannot duplicate and that the world can afford. Until that time, the emotional Dow, will fluctuate at the whim of the daily news.

    July 23, 2009 at 2:52 pm |
  5. RLWellman

    Health Care Reform is needed, but at what cost? Those that don't work, won't work, not going to do that. I don't see where it is our job to pay for you. It's also not our job to pay for illegal alien health care. Those of you that can't work or have lost your job, I have no problem in helping out.

    The Government knows it needs to strike while the iron is hot. However, it seems people are starting to question the necessity and intelligence behind all this spending. They are starting to ask questions, which is good and about time.

    Big Government does not want to help us, they want to control us. We are a necessary evil, without us, they have NO MONEY. This is why they have tried to cram so much CRAP down our throats in such a short time. So we will not have time to read and see what they are doing and the freedoms they are taking away from us.

    July 23, 2009 at 2:35 pm |
  6. Enough

    The Dow is up on the feeling the Health care bill is dead!

    July 23, 2009 at 1:34 pm |
  7. Joe G. (Illinois)

    Vote for DOW back to 3000’s and a safer/realistic economy or… Go ahead if you want it higher and back to the 1400’s..

    July 23, 2009 at 1:28 pm |
  8. Annie Kate

    Jobless claims for unemployment up, housing market up but price per house much lower, gas prices up, and Ford posting a profit.....the only good thing, I guess, is that Ford posted a profit. The other measurements are just more of the same. I hate to think we passed the stimulus package since we have of yet seen any good results from it – we're more indebted than we were, but still jobless and paying more for the same – I feel like we beggared ourselves and our children with a bill that was essentially smoke and mirrors. If the administrative wants more stimulus money in a few months I hope we make them account for the first stimulus bill before we even talk about another one – let them explain how the first stimulus bill helped with jobs, disclosures, food prices, gas prices, and talk about it in specific details. None of the high flying generic political rhetoric we usually get.

    July 23, 2009 at 1:24 pm |