Why the Dow's Not Bouncing Back This Morning

After a loss of more than 300 points yesterday, you'd hope that the Dow Jones Industrials (INDEX: ^DJI  ) would be able to put in at least a mild bounce today. But despite a drop in initial unemployment claims and a narrowing of the U.S. trade deficit, investors continue to worry about the many macroeconomic and geopolitical concerns across the globe. As of 10:45 a.m. EST, the Dow is down 31 points, and the broader indexes followed suit, trading down about a quarter-percent as well.

Among individual stocks, Disney (NYSE: DIS  ) rose 0.7% in advance of its earnings release after the bell. Yet although investors will undoubtedly look to see whether the company manages to meet expectations of roughly 15% growth in earnings per share, they'll most likely focus to a much greater extent on any further guidance Disney provides about the future impact of its recent acquisition of Lucasfilm.

Oil stocks were lower again, with Chevron (NYSE: CVX  ) down almost 1% and ExxonMobil (NYSE: XOM  ) down 0.25% after yesterday's plunge. Oil prices bounced back about $0.60 per barrel, but that's not particularly significant after crude's loss of nearly $4 on Tuesday. If the macroeconomic picture remains cloudy, then weakening energy demand could push prices down further, and that will spell bad news for Exxon, Chevron, and other oil giants.

Finally, Wal-Mart (NYSE: WMT  ) has risen 0.4% after revealing details of its holiday shopping strategy. With its decision to start Black Friday four hours early, at 8 p.m. on Thanksgiving Day, Wal-Mart is escalating the race to snag deal-hungry shoppers as quickly as possible. It's likely that other retailers will follow suit, especially with many of them still struggling with inventory issues and other problems.

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  • Report this Comment On November 08, 2012, at 7:14 PM, mythshakr wrote:

    Or, now that the elections are over the market can start worrying about the fiscal cliff in earnest. Until this is resolved, one way or the other, the market will freak out the same as it did in August 2010 until the deficit limit was raised.

    The quicker the government responds the better. So, I'm betting on the panic continuing through the end of the year.

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