Will the Dow Hold On?

Thanks to consumer confidence hitting a high not seen since 2008, the market has fought to hold on to the day's gains, in the face of yet another banking scandal. With that in mind, let's take a closer look at how the major indexes are faring and drill down on a few stocks making headlines.



Gain/Loss %

Intraday Value

Dow Jones Industrial Average (INDEX: ^DJI  ) (13.47) (0.10%) 12,841.57
Nasdaq 10.11 0.34% 2,943.75
S&P 500 (0.78) (0.06%) 1,357.21

Source: Yahoo! Finance.

The Nasdaq looks poised to finish the week on a positive note, while the Dow and S&P 500 are barely clinging on to positive territory toward the end of the trading session after recovering from a rough start. The drop is largely due to the declines seen in the financial sector spurred on by JP Morgan's (NYSE: JPM  ) surprise conference call after the markets closed yesterday.

The Wall Street bank disclosed a $2 billion derivative trading loss and shares have been punished by more than 8%. Other banking component Bank of America is down less than 1%, as a rough derivative loss at a competitor is hardly a systemic issue. But the episode reinforces the belief that even the best-run Wall Street banks struggle with risk management and raise the specter of "too big to fail."

The big action today is in health care, specifically the biotech space, after an FDA advisory committee recommended approval for Arena Pharmaceuticals' (Nasdaq: ARNA  ) obesity drug lorcaserin by an impressive 18-4 margin. Arena's closest competitor is VIVUS (Nasdaq: VVUS  ) ; its drug Qnexa received a 20-2 thumbs-up, but the FDA delayed a final decision on Qnexa by three months. The overwhelming vote of confidence is a reversal, since both drugs, along with Orexigen's (Nasdaq: OREX  ) Contrave, received lukewarm support and rejection letters from the FDA not that long ago. Treating obesity is a huge market (pun intended), so investors have a right to be excited. Arena is up 73.5% on the news, while the warm glow led to VIVUS shares gaining over 8% and Orexigen climbing an even 20%.

A better approach
Health-care investors are always looking for the next big breakthrough. Motley Fool co-founder David Gardner recently identified a small-cap health care company that he believes is poised for monster returns. To uncover this top pick today, enjoy the special free report "Discover the Next Rule-Breaking Multibagger." Don't miss out on this limited-time offer and your opportunity to discover this game-changing company before the market does. Access your report now -- it's totally free.

David Williamson holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of JPMorgan Chase. The Motley Fool has a disclosure policy. We Fools may not 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.

Read/Post Comments (0) | Recommend This Article (7)

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.

Compare Brokers

Fool Disclosure

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: 1885674, ~/Articles/ArticleHandler.aspx, 5/27/2016 8:37:13 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...

Today's Market

updated Moments ago Sponsored by:
DOW 17,873.22 44.93 0.25%
S&P 500 2,099.06 8.96 0.43%
NASD 4,933.51 31.74 0.65%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

5/27/2016 4:43 PM
^DJI $17873.22 Up +44.93 +0.25%
ARNA $1.75 Up +0.13 +8.02%
Arena Pharmaceutic… CAPS Rating: **
JPM $65.43 Up +0.40 +0.62%
JPMorgan Chase & C… CAPS Rating: ****
OREX $0.42 Up +0.01 +1.68%
Orexigen Therapeut… CAPS Rating: **
VVUS $1.23 Down -0.01 -0.81%
VIVUS, Inc. CAPS Rating: **