Why the S&P 500 Dipped Slightly

Today ended as the day began, with slight weakness dragging the S&P 500 (INDEX: ^GSPC  ) down 1.50 points to 1403.44. As the Fool's Dan Dzombak noted earlier, moderately optimistic data from the U.S. Department of Labor signaled an increase in productivity and tame labor unit cost increases, which helped curb today's downside pressures. With all eyes now focused on tomorrow's European Central Bank meeting, let's examine what companies helped and hindered the S&P 500 today.

Companies that helped the S&P 500
Sealed Air
(NYSE: SEE  ) was the index's biggest gainer today, tacking on nearly 6%, following comments from Stewart Capital that the packaging company could be a takeover target. Sealed Air has struggled mightily since its purchase of Diversey Holdings for $2.9 billion in June 2011. It's also the only U.S. packaging company currently trading below both the value of its revenue and net assets. However, given its well-documented struggles, perhaps the pessimism is warranted.

Safeway (NYSE: SWY  ) also turned in a nice performance, rising greater than 4%, after the grocer outlined plans to take its gift-card business, Blackhawk Network Holdings, public by the first half of 2013. As the nation's largest third-party distribution system, the spinoff of Blackhawk could provide Safeway shareholders a way of unlocking value in their shares in light of tepid consumer spending inside Safeway's grocery stores.

Companies that hindered the S&P 500
Chipmaker Advanced Micro Devices (NYSE: AMD  ) was a notable loser today, falling nearly 4%, after receiving a downgrade to "neutral" from "buy" at UBS. The brokerage firm cited competitive pressures and structural changes within AMD as the impetus for the downgraded and the slashing of its price target to $4 from $6.25. Given that Intel controls a vast majority of the microprocessor market, many investors, including me, have every reason to be skeptical about its turnaround efforts.

Perhaps the biggest bombshell came from FedEx (NYSE: FDX  ) , which lowered its first-quarter earnings guidance in light of weak global growth tied to the European debt crisis and slowing growth in Asia. FedEx noted that consumers are opting for cheaper deferred services and less for higher-margin premium overnight mailing. As a prime economic indicator, FedEx will find that its woes could have some bearing on where the U.S. economy is headed next.

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Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

The Motley Fool owns shares of Intel. Motley Fool newsletter services have recommended buying shares of Intel and FedEx. 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 Motley Fool has a disclosure policy.


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