Squawk Morning Briefing: Biggest and Smallest Dow Earnings

Yesterday we had three of the 30 DJIA stocks reporting earnings; today we have only two. BAC, the lowest of the index components, reported this morning and IBM, the highest priced, will report after the close. The price is important because the DJIA is a price-weighted average.

That means that a 1% change in the price IBM will affect the index about as much as a 23% change in BAC. BAC shareholders might care that the stock was initially up about 1% on earnings and is now trading down from Tuesday’s close, but within the index it will be IBM’s report after the bell which can really move the average.

As far as anticipating direction goes, we’re still in a situation where U. S. equities could go up or down, but based on our analysis from the past few days the upside seems to have a bit more going for it. The detailed levels were watching and scenarios we’re considering are updated in today’s videos.

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