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Ford, the only of the Big 3 American automakers to not need government bailout money (although the company did request a standby line of credit “just in case”), reported a profit of $1 billion for the third quarter. The news has provided a jolt of energy to a stock market that ended October on a rather dour note. Stocks are gaining, with the Dow up more than 100 points. It is far from certain that the stock market will be able to recoup all of its losses from last Friday, but it looks like the bulls are willing to give it a try. It may even be that the Dow makes another run at 10,000 this week.

However, some of the stock market’s success this week will depend on what happens with other news. Economic data will be heavy this week, so it will be necessary for the economy to show some fight and signs of recovery in order for the stock market to truly overcome. European stocks are higher as well, providing some help. And the stock market barely noticed the fact that CIT declared bankruptcy. The company claims that most of its debt holders are on board with the plan for reorganization, so the fifth-largest U.S. bankruptcy doesn’t appear to be causing a lot of consternation.

It will be interesting to see what happens going forward. Ford claims that it should be solidly profitable by 2011, and that things are looking up. Most of last quarter’s profits came with help from the Cash for Clunkers program, so it will be interesting to see whether Ford can remain sanguine moving forward.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.

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Earlier today, the news was released that consumer confidence has dropped again. There had been hopes for a modest increase in consumer confidence ahead of the holiday shopping season, but employment concerns continue to weigh on consumers. The news sent the stock market lower in early trading, as investors worried that this vital segment of the economy would not be recovering anytime soon. However, things are taking a new direction, thanks to an upturn in oil prices.

Energy stocks rise, bring up the Dow

Energy stocks are on the rise, though, thanks to the latest movement in oil prices. MarketWatch reports on the response of the Dow to gains by oil:

U.S. stocks turned firmly up in mid-morning trade Tuesday, as crude oil futures rebounded from early weakness on optimism ahead of supplies data, lifting the energy sector of the market. …

Crude oil futures recently gained 67 cents to $79.35 a barrel, as traders weighed prospects of stronger Chinese demand ahead of U.S. inventories data due later Tuesday and on Wednesday.

Yesterday, energy stocks couldn’t hold onto gains, and were overcome by financial companies and sinking oil prices. Today, the opposite is happening. With the most recent report out of China about its likely economic report, speculators expect that oil prices will rise as China uses more oil to fuel economic expansion as we move into 2010.

The Dow still remains short of 10,000, and it is not likely to reclaim that level today, but there is a chance that, if things continue to move in this direction, we could see Dow 10,000 again by the end of the week. On the other hand, of course, any new economic data and concerns about economic recovery could change everything around, and send the stock market plunging again. We truly are at a very delicate and volatile crossroads.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.

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As the Dow moves back above the 10,000 level today, some are looking at the effects of economic stimulus on different sectors. As might be expected, reports MarketWatch, housing and manufacturing have been benefiting from efforts to stimulate the economy, according to the Fed’s Beige Book:

“Not surprisingly, the two sectors the book highlights as ‘leading the more positive sector reports among districts’ were real estate and manufacturing, among the hardest hit sectors of the economy and the two benefiting the most from government support,” said Dan Greenhaus, chief economic strategist at Miller Tabak & Co.

The Beige Book “supports the notion that the U.S. economy is experiencing a slow recovery, with significant aid from government stimulus programs such as the first-time homebuyer credit and the recently expired cash for clunkers,” said Nicholas Colas, ConvergEx chief market strategist.

Clearly, there is a long way to go in terms of economic recovery. But the stock market is an indication that investors, at least, are hopeful that economic recovery on the way. Well, sort of. Today’s stock market earnings are almost exclusively in the form of the Dow. The S&P 500 is barely managing to stay in the black, and the Nasdaq is lower. But earnings have been providing a measure of confidence and optimism. And the fact that there still remains close to 80% of the stimulus to spend means that the government is likely to find more sectors to prop up in the future, in the hopes of buoying up the economy.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.