3 Dow Stocks That Led the Market Down Today

On a topsy-turvy day for the markets, the bears ended up winning the day. As has happened during previous down sessions, a big drop in shares of Apple seemed to get investors thinking more about taking profits after the six-month run-up in stock prices. By the end of the day, the Dow Jones Industrial Average (INDEX: ^DJI  ) fell 69 points to 12,964, once again closing below the 13,000 level and making some analysts wonder whether a deeper correction for the market is in the works.

Let's take a closer look at some of the Dow's worst-performing stocks today to get a sense for what pulled the average down.

McDonald's, down 2.1%
McDonald's is due to report earnings tomorrow morning. But it looks like investors got a head start selling off their shares today, even though analysts expect good things from the company.

The fast-food giant has executed well lately, managing international expansion, revamping its menu offerings, and handling price volatility in its food costs. What may be making some investors nervous, however, are the high expectations that Wall Street has for the stock. With analysts looking for 6%-plus same-store sales growth and significant boosts in earnings and revenue, McDonald's could see an even bigger selloff if its results come in worse than even those fairly lofty expectations.

Alcoa, down 1.9%
Sometimes, it's nice to get the hard work done early. But even though Alcoa was first to get its earnings out of the way, it still faces a tough time navigating conflicting data about current economic conditions.

Downbeat news from the Philadelphia branch of the Federal Reserve about manufacturing activity was likely one factor weighing on Alcoa's shares today. Similar news from the New York Fed confirmed the slow-growth assessment. That doesn't match up well with what Alcoa needs: a strong expansion that can pull aluminum prices out of the basement. Until that happens, Alcoa will be hard-pressed to find a way to turn things around for good.

DuPont, down 1.2%
When a company beats estimates, you usually expect a nice gain even on a down day. But DuPont foiled those hopes even after a reasonably strong quarterly report.

DuPont's 6% jump in earnings per share was good enough to beat analyst expectations. Growth in emerging-market sales and success in maintaining pricing power both helped power the chemical-maker's quarter. But investors may not have been pleased at DuPont's failure to raise its outlook for full-year 2012, which is roughly in line with current expectations. With particular strength in agriculture, DuPont stands ready to capitalize as long as crop prices stay high, supporting farmers' ability to pay for the company's seeds and pesticides.

Don't give up
Even on a down day, some companies will report earnings surprises that will push their shares strongly higher in the coming weeks. Get the insight you need on earnings season from The Motley Fool's brand-new special report, which identifies five stocks that investors simply have to watch this earnings season. Don't wait another day; get the scoop before these companies report.

Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. You can follow him on Twitter. Motley Fool newsletter services have recommended buying shares of McDonald's. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.


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