Dow Breaks Even for 2011, IBM Biggest Contributor

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U.S. stocks rose Wednesday as a potential agreement out of Slovakia on the European Financial Stability Facility (EFSF) expansion gave a boost to global markets.

So far this month, the NASDAQ is up 8 percent, while the S&P 500 and Dow are up 7 percent and 6 percent, respectively. All three major averages have not been able to post a monthly gain since April.

Volatility is also off its highs, with the VIX trading at around 30, or its lowest level since early August.

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With today's gains, stocks are now pushing the upper end of their recent trading range -- the S&P 500 is trading at the highest level since September 20.

On Monday this week, the S&P 500 closed above its 50-day moving average for the first time since late July and all 10 S&P sectors are currently trading above their 50-day moving average.

In fact, the S&P tech and consumer discretionary sectors have even pushed above their 200-day moving averages, joining consumer staples and utilities, which had already been above that threshold.

Dow Breaks even for 2011
The Dow broke even for 2011 as of midday trading, while the S&P is 3 percent away from turning in a gain this year. The Dow's performance has been helped by IBM, which is trading at a historic high, and has boosted the Dow by nearly 310 points this year.

IBM is the best-performing stock on the Dow so far this year and it's also the heaviest-weighted stock in the index based on its price. Big Blue’s 12 percent weighting is nearly double the second largest stock in the Dow, Chevron.

Although more than half of the Dow’s stocks are down this year (17 out of 30 components), IBM’s heavy weighting has certainly helped the index overcome some of the weakness elsewhere. Indeed, IBM’s large positive point-impact fully offsets the combined effect of 13 Dow components.

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