Dow stalwarts lead the blue-chip recovery

IBM, Caterpillar and 3M contribute the most to the Dow's 118% gain since the March 2009 market bottom. Only one Dow stock is lower since then: Hewlett-Packard.

By Charley Blaine Mar 5, 2013 5:26PM
The stocks that brought the Dow Jones Industrial Average ($INDU) to record highs on Tuesday are hardly Johnny-come-latelies.

The top six contributors to the 7,700-point gain are giants in corporate America: IBM (IBM), Caterpillar (CAT), 3M (MMM), Chevron (CVX), American Express (AXP) and United Technologies (UTX). And they've been in the Dow for at least 20 years.

IBM went into the Dow in 1932, left in 1939 and returned in 1979. Chevron was a Dow component from 1934 to 1999 and returned in 2008. United Technologies has been in since 1939. The newest member of the top six is American Express. It joined the Dow in 1982.

IBM is up 147% since the market bottom on March 9, 2007. It has contributed more than 944 points to the Dow's gain from the low -- 12% of the total. Caterpillar's contribution is 6.6%. 3M's is 6.2%.

All but one of the 30 Dow stocks have gained since the March 2009 low. The laggard is Hewlett-Packard (HPQ).
.
On an inflation-adjusted basis, the Dow's performance is not so rosy. Discounted for inflation, the Dow is lower than it was in 2000, The New York Times said on Tuesday. So is the Standard & Poor's 500 Index ($INX).

Still, the market is in pretty good shape. Not only is the Dow at a record level, so are the Dow Jones Transportation Average ($DJT), the S&P Midcap 400 Index ($MID), the S&P Small-cap Index ($SML) and the Russell 2000 Index ($RUT).

The causes for the rally are a stronger economy, given loving stimulus from the Federal Reserve. The Fed has kept short-term interest rates nearly at 0% and pushed the yield on the 10-year Treasury note to 1.894%. The 10-year yield was 4.04% at the end of 2007, before the 2008-2009 market collapse.

The Dow's 30 components are regularly changed. Some merge with other companies. Others go out of business. Today's Dow has five components that weren't in the index when the market crashed in 2008.

Bank of America (BAC) and Chevron replaced Altria (MO) and Honeywell (HON) in early 2008. And, yes, the inclusion of Bank America was ironic because it then required a federal bailout to survive.

Kraft Foods (KRFT) replaced American International Group (AIG) in September 2008.

Traveler's Corp. (TRV) replaced Citigroup (C) and Cisco Systems (CSCO) replaced General Motors (GM) in June 2009.

And UnitedHealth Group (UNH) replaced Kraft in September 2012 after Kraft split itself up.

Where the Dow's gain since 2009 have come from
Company

Tues. close

Contribution to Dow gain
IBM

$206.27

12.24%
Caterpillar

$90.10

6.59%
3M

$104.31

6.20%
Chevron

$117.75

5.93%
American Express

$64.12

5.33%
United Technologies

$90.94

5.32%
Home Depot

$70.39

5.20%
Travelers Companies 

$81.44

4.78%
Boeing

$78.61

4.74%
McDonald's

$95.81

4.33%
Walt Disney Co. 

$56.38

4.06%
UnitedHealth Group

$53.32

3.54%
JPMorgan Chase

$49.51

3.35%
Procter & Gamble

$77.09

3.28%
DuPont    

$48.64

3.24%
Johnson & Johnson 

$77.55

3.08%
Wal-Mart Stores

$73.77

2.62%
Exxon Mobil

$89.52

2.49%
Verizon 

$47.63

2.31%
Merck

$43.18

2.21%
Coca-Cola

$38.64

1.96%
General Electric

$23.61

1.61%
Pfizer

$28.05

1.54%
AT&T

$36.60

1.48%
Microsoft

$28.28

1.31%
Intel

$21.48

0.89%
Bank of America 

$11.57

0.78%
Cisco Systems

$21.17

0.75%
Alcoa  

$8.36

0.30%
Hewlett-Packard

$20.38

-0.51%

10Comments
Mar 5, 2013 6:52PM
avatar

a real scary comment on truly where we stand today: 

 

>>>>>On an inflation-adjusted basis, the Dow's performance is not so rosy. Discounted for inflation, the Dow is lower than it was in 2000, The New York Times said on Tuesday. So is the Standard & Poor's 500 Index (). <<<<<

Mar 5, 2013 9:50PM
avatar
Measured against inflation this is not a new high. I would have to guess that with the sorry state of the general economy that inflation is the only reason we're seeing this level in the market.
Mar 5, 2013 9:59PM
avatar
The market it seems, tends to find these new highs just as we enter downturns. The NASDAQ in 2000, the DOW in 2007. Now we are reaching new highs as some indicators are turning lower. Don't buy into bubbles and euphoria if you want to stay solvent.  
Mar 5, 2013 9:27PM
avatar
Any bets that the Dow closes below 9,000 before the end of March and at least one Too Big To Fail bank-- does? Brutus isn't kidding about the trading volume. It stinks of smack.
Mar 5, 2013 6:36PM
avatar

The Dow sets a record and watch the sour puss Republicans cry.The market will go down.Just as soon as Jeb Bush gets in the WH.Then we can have endless wars, recessions,hate crimes and

tax breaks for the rich.

Mar 5, 2013 8:10PM
avatar

CRAZY 8: As usual you`re wrong.If a Repub was in office when a record you`d be

dancing in the streets.Of course, the Dow was down 37% with Bush, so no party.

It`s time for you to man up and admit the right guy is in the WH.We don`t need a

loser like Bush.We`re making tons of money and I`m enjoying the nice restaurants

and the like.Sorry you`re on the losing side again.

Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

116
116 rated 1
274
274 rated 2
447
447 rated 3
698
698 rated 4
633
633 rated 5
652
652 rated 6
650
650 rated 7
491
491 rated 8
268
268 rated 9
125
125 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
TAT&T Inc9
VZVERIZON COMMUNICATIONS9
EXCEXELON CORPORATION8
AAPLAPPLE Inc10
ATVIACTIVISION BLIZZARD Inc10
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.