Today’s Top 3 Dow Stocks: Bank of America Corp (BAC), The Coca-Cola Company (KO)

The Dow Jones Industrial Average is down after news out of Cyprus outweighed a better-than-expected housing report. As of 1:15 p.m. EDT the Dow is down 65 points, or 0.45%, to 14,387. The S&P 500 is down 0.85% to 1,539.

There was just one economic release today.

Source: MarketWatch U.S. Economic Calendar.

Following yesterday’s poor homebuilder confidence numbers, investors were relieved to see positive housing data. This morning the Department of Commerce reported that housing starts increased 0.8% to a seasonally adjusted rate of 917,000, up from January’s 890,000. February’s results are 27.7% higher than the February 2012 rate of 718,000. The positive housing-starts data shows continued strength in the housing market, which was a boon for the economy last year.

The number that really deserves a closer look is the positive building-permits figure. Building permits rose 4.6%, or 42,000, to a seasonally adjusted rate of 946,000. Building permits are an indication of future housing starts, so when building permits rise it’s a good sign of future housing-market strength.

US New Housing Permits data by YCharts.

The housing market took a beating in the most recent recession, but activity rose significantly last year. If the housing market can continue to improve, it bodes really well for the U.S. economy.

Still, the stock market is overlooking the positive news, as Cyprus’ parliament is currently abstaining from a bailout vote, while the Cypriot finance minister has reportedly submitted his resignation. Cyprus is in turmoil as European leaders argue over how to bail out the country’s bankrupt banks. Investors are worried that if the country follows through on its plans to institute a one-time tax on bank accounts in the country, a run on banks could occur across Europe. If you want to know more, Fool banking analyst Morgan Housel took a long look at the situation in Cyprus and what it means for investors.

Today’s Dow leaders
Today’s Dow leader is The Coca-Cola Company (NYSE:KO), up 1% to $39.14 on no real news. The beverage giant’s results are largely unaffected by the health of the economy, so the news in Cyprus isn’t scaring off Coke investors. Last week the company finished down 1% as Chinese authorities announced an investigation into Coca-Cola employees’ use of GPS devices. Some mapping and geographic information is regulated in China due to concern for “national security.”

There’s a lot to like about The Coca-Cola Company (NYSE:KO). The company currently yields 2.9%, has the top two soda brands in the U.S. in terms of market share, and is expanding around the world. Investors and analysts are taking note of the company’s increasing dominance over PepsiCo, Inc. (NYSE:PEP), and just last week an analyst from CLSA upgraded the stock from underperform to outperform.

The second-best Dow stock today is Bank of America Corp (NYSE:BAC), up 0.5%. Bank of America’s results are largely dependent on the U.S. economy. With today’s positive housing reports showing continued strength in the housing market, Bank of America should benefit over the long term. Last week Bank of America Corp (NYSE:BAC) got a vote of confidence from the Fed, which approved its plan to buy back $5 billion worth of stock over the next year — a good investment, as the company currently trades below its book value.