When the stock market gets in a rut, it can stay there for quite a while. That's certainly been the case this month, as concerns about Europe and the U.S. economic recovery have pushed stocks sharply lower. That trend continued today, as weaker-than-expected figures on private-sector job growth and a reduction in the initial estimate of U.S. GDP in the first quarter from 2.2% to 1.9% weighed on the market. Around 10:55 a.m. EDT, the Dow Jones Industrials (INDEX: ^DJI ) were down 88 points to 12,331.
Within the Dow, stocks acted fairly predictably in response to the poor economic news. Caterpillar (NYSE: CAT ) fell more than 4%, as just about every driver of its recent growth is under threat from a slowing economy. Moreover, as fellow Fool Brenton Flynn pointed out earlier today, poor earnings guidance from mining equipment rival Joy Global is also reflecting badly on Caterpillar, which expanded strongly into the mining industry when it bought Bucyrus.
But some companies are positioned to benefit from a slowdown. Wal-Mart (NYSE: WMT ) rose another 1% this morning, setting another multiyear high as it approaches levels last seen more than a decade ago. A slowing economy pushes more customers to cut back on spending, boosting the retailer's low-price model.
Looking past the Dow, Facebook (Nasdaq: FB ) continued its slide after having given up an early gain yesterday morning. Trading just above $27 per share, the social media giant still shows few signs of hitting bottom, and with everyone pointing fingers at everyone else over the company's IPO debacle and recent losses, few investors seem to be looking at the business itself and its future prospects. It could take a long time for the controversy to die down, and until it does, it'll be hard to take an objective look at the company and the stock as an investment.
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