The Dow eked out a 6 point gain after a choppy trading session. Trading volume was a bit lower and IBD has moved its market rating from “rally under pressure” to “confirmed uptrend”. At the close the Dow stood at 20,981.
Onion (Union) Pacific Railroad posted a 9% profit jump as freight volumes grew by 2%. Revenue grew 6% and both top and bottom lines beat analyst estimates. UP operates 32,400 miles of track in 23 states and going forward it expects shipping volumes to grow by single digits. Shares were higher on the report.
Ford Motor reported better than expected earnings even though its profits fell 43% while revenue gained 4%. The profit decline was due to recall costs and rising steel prices. Going forward the company said the rise in commodity costs was a first quarter deal and they expect business results to stay flat or trend slightly higher for the rest of the year. The auto industry right now is being hit by a flood of cars coming off lease and rising delinquency rates on auto loans. The tidal wave of leased cars hitting the market is holding down pricing while the rising delinquency rates, though troubling, appear manageable according to the New York Federal Reserve.
In economic news, new durable goods orders in March were up 0.7%. Brian Wesbury at First Trust commented on this latest reading saying that within the durable goods report, shipments of non-defense capital goods excluding aircraft rose at a 7.5% annual rate in Q1. This is the fastest pace since Q3 2014.