Why These Stocks Are Pulling the Dow Lower

The Dow Jones Industrial Average (INDEX: ^DJI  )  doesn't know what to do today. One moment it's up, and the next it's down. A report looks like good news -- until you read a little further, and it gets bad. As of 1 p.m. EDT the index is at 13,093, up 21 points, or 0.12%. One of the most widely watched numbers released today was the initial jobless-claims number. Last week 369,000 workers filed for claims, which is a drop of 23,000 from the previous week's revised number. What's rubbing investors the wrong way is that the four-week moving average continues to increase, up 1,500 this week after it increased by 750 last week.

On this day of topsy-turvy trading, let's look at three companies and how top news stories are affecting their stock price. The three big losers today are Home Depot (NYSE: HD  ) , Boeing (NYSE: BA  ) , and AT&T (NYSE: T  )

So why are they down?
Home Depot is moving lower today after the existing-home sales report was released. Sales rose 0.3% in September after August saw a drop of 2.6%. But the National Association of Realtors said that Americans signed fewer contracts than the group had forecast for the month. More so than any other Dow component, Home Depot is tied to the housing market and its recovery. The sooner we see homes selling at a decent rate, the better the stock will perform. Home Depot's shares are trading lower by 0.8% today.

Aircraft manufacture Boeing is down by about 2.5% today. The company just reported earnings yesterday, and the stock was higher after the release. But today is another day, and with new fears that some airlines may cut back on their purchases due to reduced passenger travel, the company is taking a hit. In addition, Sprint AeroSystems Holdings, an airplane parts manufacturer, is warning that the company will take huge hits in the third quarter. The company produces parts for a number of Boeing aircraft, and investors may be concerned that Sprint may delay delivery of certain parts, which would in turn hurt Boeing.

Finally, AT&T is moving lower by 0.65% after Sprint (NYSE: S  ) announced earnings this morning. While AT&T and Verizon (NYSE: VZ  ) are much further ahead of Sprint in the U.S. market, and Sprint's business troubles will not affect the others, what is affecting AT&T is that Sprint lost 423,000 subscribers. This decline is the first time in two-and-a-half years Sprint lost customers. This matters to AT&T because it only increased its customer base by 151,000 members in the third quarter, while Verizon added 1.5 million. AT&T is falling way behind Verizon in growth, even as the No. 3 service provider is losing customers.

With great opportunity comes great responsibility. For Boeing, which operates as a major player in a multitrillion-dollar market, the opportunity is absolutely massive. However, the company's execution problems and emerging competitors have investors wondering whether Boeing will live up to its shareholder responsibilities. In this premium research report, two of The Fool's best industrial minds have collaborated to provide investors with info on the must-know issues regarding Boeing. They'll provide updates as key news hits, so be sure to claim a copy today by clicking here now.

Matt Thalman has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Monsanto Company. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.If you have questions about this post or the Fool's blog network, click here for information.


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  • Report this Comment On October 25, 2012, at 2:39 PM, flyboeing wrote:

    Your fact checker on the Boeing piece was off. Spirit Aerosystems is the name of the supplier that is taking a hit, not SPRINT. Thought that I would share the observation

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