The Dow Jones Industrials Average (INDEX: ^DJI ) breathed a sigh of relief today and snapped a four-day losing streak with a modest 0.2% gain. As the index flirts with falling below 12,000, a level not seen since last year, investors are probably happy for whatever gains they can eke out. Here's a look at how the other indices fared today.
Gain / Loss
Gain / Loss %
|Dow Jones Industrial Average
Source: S&P Capital IQ.
Even though the Dow didn't line investors' wallets today, that doesn't mean there wasn't money to be made off the index. In fact, three Dow stocks absolutely crushed their parent index today.
- JPMorgan Chase (NYSE: JPM ) , up 3.2%
- Bank of America (NYSE: BAC ) , up 2.9%
- Hewlett-Packard (NYSE: HPQ ) , up 2.9%
Seeing JPMorgan Chase at the top of this list doubly underscores my point from yesterday about not fearing a falling Dow. JPMorgan has consistently been the best or worst Dow performer on a given day, yet after all the volatility, the company still remains one of the best values in both the banking sector and the index as a whole. Yes, the market goes up, and yes, the market goes down, but if you'd have run for the sell button after JPMorgan's drop yesterday, you would have missed today's pop. The banking sector is fragile but is likely to reward the patient investor over the long run.
Bank of America basically rose in symphony with JPMorgan today. While neither company is trading on much news, it's likely that the lack of more bad news sent shares higher. With the eurozone resembling an economic 17-car pile-up combined with an austerity train wreck, the finance sector has probably adopted the "no news in good news" mantra for now.
Hewlett-Packard is trading higher on little news as well but is gearing up for a fight with industry heavyweight Oracle. Yesterday, HP accused Oracle of breaching a contract and kicked off a big tech boxing match, in a spat over whether Oracle's decision to stop developing software for HP servers running itanium chips violates an agreement between the two companies. Given how far HP has fallen from grace, even a modest win against Oracle would probably be a boon for the company, even if it's figurative.
Facebook crashes to new lows
Everyone's newest love-to-hate IPO, Facebook (Nasdaq: FB ) , fell yet again today. The company hit a new low and closed at $25.87 per share. Today's drop caps what has been a 32% slide downward since the company's late-May debut on the markets. After the bell, it was reported that Morgan Stanley, the lead underwriter for the IPO and Wall Street's newest whipping boy, has begun lending shares to traders who want to sell the stock short.
S&P Capital IQ analyst Scott Kessler raised his rating on the stock to a "hold" today, roughly in line with analysts' average current rating. I'm still drawing my line on the sell side of the fence, though. Facebook's lack of meaningful mobile monetization has me worried. The problem isn't exclusive to Facebook, either. Most big-name tech companies, including Zynga and Pandora, have the same difficulty whereby mobile users are less profitable than desktop users. Yet people are increasingly consuming on mobile devices and less so on their computers. Rumors of a Facebook phone do little to quell my worry, either, as it seems like a horrible waste of capital.
I see the Facebook debacle getting uglier before it gets better.
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