Why the Dow Fell Today

The Dow Jones Industrial Average (INDEX: ^DJI  ) finished down today as worse-than-expected employment data and news of a weak bond auction in Spain weighed on investors.

Index

Change

Ending Value

Dow Jones Industrial Average +124.80[-0.95%] 13,074.75
S&P 500 (INDEX: ^GSPC  ) -14.42 [-1.02%] 1,398.96

Yesterday the market fell after the Federal Reserve released minutes from its March meeting suggesting that there wouldn't be another round of quantitative easing. That was still on investors' minds at 8:15 ET this morning, when ADP released its employment report. The payroll company reported that private employment numbers rose 209,000 in March, below February's 230,000 gain. More jobs data is on the way: Weekly jobless claims come out tomorrow morning, and the March unemployment rate and nonfarm payrolls are reported on Friday.

The other news from this morning has the potential to reignite fears over Europe. Spain had a weaker-than-expected bond offering this morning, with the yield on Spain's five-year debt rising to 4.45%. The country had intended to auction 3.5 billion euros of debt but sold only 2.6 billion euros' worth. Spain has some serious problems in its economy, including a sky-high unemployment rate and a large fiscal deficit. Fool analyst John Maxfield has been eyeing Spain for some time and on Monday took a deep look at the situation in Spain.

Top winner
Today's top Dow stock was Merck  (NYSE: MRK  ) , up 0.48% to $38.90. The stock is up for the second day in a row, again on no news. It's one of the more stable stocks in the Dow, as the demand for its drugs are largely not dependent on the health of the economy -- but even so, Fool analyst Ilan Mosovitz labeled Merck as one of the 10 Worst Dow Stocks to Buy based on its P/E, estimated earnings growth, and dividend yield.

Top loser
Bank of America
(NYSE: BAC  ) was today's worst Dow stock, down 3.06% to $9.20. The Financial Select Sector ETF (NYSE: XLF  ) was also down 1.6%, indicating a bad day for financials overall. Since passing the Federal Reserve's annual stress test three weeks ago, Bank of America has risen 19%, and our analysts believe that its rise could continue -- among them Fool analyst Anand Chokkavelu, who thinks Bank of America could hit $20 and explains how he thinks it will happen. Fool analyst John Maxfield also believes now is the time to buy Bank of America.

The best approach
If you only checked yesterday's close and today's, you wouldn't have thought there was any change. Watching the broad market each day is exciting, gut-wrenching, and stressful, but investing doesn't have to be. If you're in the mood to pick up a few great companies to buy for the long term, The Motley Fool has created a brand-new free report: "3 Stocks That Will Help You Retire Rich." It features three stocks to help you build a smarter retirement portfolio. Get access to the report and find out the name of these three companies. The report is free, but it won't be forever, so check it out today.

Dan Dzombak owns shares of holds no other position in any company mentioned. Like his Facebook page to follow his investing articles. The Motley Fool owns shares of Bank of America. Motley Fool newsletter services have recommended buying shares of Automatic Data Processing. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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