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Europe was front-and-center in investors' minds today, as Greece approaches a deadline to move forward with resolving its debt situation. Yet good economic news from Germany and suggestions that the European Central Bank may already have handled the worst of the crisis rekindled enthusiasm for risky assets. By the close, the Dow Jones Industrial Average (INDEX: ^DJI ) finished up strongly for the second day in a row, rising 71 points to 12,908, while the S&P 500 (INDEX: ^GSPC ) climbed 13 points to finish at 1,366.
But even with the good mood on Wall Street, some stocks fell sharply. Let's look at three of them.
McDonald's (NYSE: MCD ) , down 3.2%
Things may be looking up in Europe now, but February definitely wasn't a good month for McDonald's there. The fast-food leader said that same-store sales rose 7.5% in February globally, falling short of expectations. European weakness didn't help matters, with only a 4% gain in sales on the continent versus expectations of more than a 6% gain. But the biggest disappointment came from the Asia/Pacific region, with sales rising 2.4%. By contrast, the U.S. market was exceedingly strong, posting double-digit percentage growth partly from some new product offerings.
McDonald's stock has been on a tear lately, so a minor pullback isn't necessarily bad news. Watch the company carefully in future months to see whether this is a one-time aberration or the beginning of a longer-term trend.
ExxonMobil (NYSE: XOM ) , down 1.2%
Oil prices remain comfortably above $100 per barrel, so why is the nation's largest oil company dropping? Today, Exxon said it expected oil and natural gas output to drop 3% in 2012, even though it's increasing the amount it spends on new projects to try to boost production. Until those new projects start bearing fruit, lower yields from old oilfields are largely responsible for the output drop.
Longer-term, the company still expects to see 1% to 2% annual growth in production as a result of plans to spend roughly $37 billion per year over the next five years. But the long-term impact that could have on margins poses a problem for Exxon, especially if energy prices start to fall.
Intel (Nasdaq: INTC ) , down 0.2%
Excitement about the newest iPad pulled everyone's attention away from Intel. But bad news about the PC market probably played a role in the chipmaker's decline today.
IT research firm Gartner said that shipments will be weaker than it originally expected in 2012, pushing down its estimate for shipment growth by a tenth of a percent to 4.4% for the year. Although Gartner sees higher shipments by the end of 2013, the real question is the extent to which mobile devices cannibalize PC demand.
In that light, it's good that Intel is diversifying itself to go after more of the mobile market. PCs won't disappear anytime soon, but mobile is where the growth is.
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