Why the Dow's Going Nowhere Today

It's only natural for stocks to take a breather after a big up-day. That's exactly what's happening today, as many start to wonder if the nearly 13% rise in the S&P 500 we've seen so far in 2012 really leaves room for further gains. As of around 1:45 p.m. EDT, the Dow Jones Industrials (INDEX: ^DJI  ) were down nine points to 13,232, while the S&P 500 was just above the unchanged mark at 1,417.

Among Dow stocks, Pfizer (NYSE: PFE  ) soared more than 1.5% on speculation that the company will not only sell off parts of its business but also split its remaining segments into multiple companies via spinoffs. Comparing the situation to the breakup that Abbott Labs (NYSE: ABT  ) is in the process of doing, analysts at Goldman Sachs released a report suggesting that Pfizer could be more aggressive in restructuring itself. Lately, it seems that a number of stocks across various industries are turning to spinoffs as a way to unlock shareholder value.

DuPont (NYSE: DD  ) rose about 0.5%. Brazilian agriculture company Camera Agroalimentos announced plans to build a biodiesel chemical plant in its home country for about $11 million. The company plans to buy needed sodium from DuPont. Although the move is obviously a small one, the growing biodiesel movement could spell an opportunity for the chemical maker to move more strongly into the alternative energy industry.

Finally, Coca-Cola (NYSE: KO  ) was roughly unchanged in afternoon trading. An interesting article in Forbes compared cola companies in the U.S. to cigarette companies, as they've been facing lower volumes and answering by offering higher-margin products. Unlike many tobacco companies, though, Coke has international expansion opportunities that should help boost profits well into the future.

Think long-term
Even when the Dow goes nowhere, great stocks can provide good returns over time. Learn about the one stock the Fool's chief investment officer picked to crush the market in this free report: "The Motley Fool's Top Stock for 2012." Instant access is just a click away.

Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. You can follow him on Twitter here. The Motley Fool owns shares of Coca-Cola and Abbott Labs. Motley Fool newsletter services have recommended buying shares of Goldman Sachs, Coca-Cola, Pfizer, and Abbott Labs. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.


Read/Post Comments (0) | Recommend This Article (4)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1846727, ~/Articles/ArticleHandler.aspx, 10/31/2014 5:37:02 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement