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Why a Few Stocks Missed Today's Move Higher

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After getting overloaded with mixed economic data this morning, the markets got the good news that Israel and Gaza had agreed to a cease-fire in the Middle East.  The Dow Jones Industrial Average (INDEX: ^DJI  ) closed today up 48 points and now sits at 12,836. With the markets closed tomorrow and open for only half a day on Friday, volume will probably be light, and investors shouldn't expect very much action until Monday.

Today, only six of the Dow's 30 components ended the trading session in the red. This afternoon, I discussed why Wal-Mart (NYSE: WMT  ) , JPMorgan Chase (NYSE: JPM  ) , and Intel (Nasdaq: INTC  )  were all moving lower. Read about those three companies by clicking here, or stick around to learn why Caterpillar (NYSE: CAT  ) , Du Pont (NYSE: DD  ) , and Johnson & Johnson (NYSE: JNJ  ) also ended the day down.

So why did they fall?
This morning, Berkshire Hathaway's (NYSE: BRK-B  ) new darling stock pick, Deere (NYSE: DE  ) , announced third-quarter earnings that beat on the top-line sales but missed on earnings. The company said the bottom-line miss was a result of higher costs for raw materials and a stronger dollar. Deere's results probably stem from the same reason shares of Caterpillar traded lower by 0.34% today. Both companies build large machinery that's sold all around the world. Input costs would be very similar, and of course, the strong dollar is bad for any multinational based in the United States. 

Chemical company Du Pont saw shares slide 0.89% today. The stock price has declined more than 14% over the past month and is now down nearly 7.5% year to date. Fool analyst Dan Caplinger recently looked in Du Pont and concluded (shocker alert) that the company is not yet the perfect stock. He believes the company needs to quickly work through its restructuring process, which should help improve margins and allow management to reduce its debt load.

Lastly, Johnson & Johnson's shares moved lower by 0.11%. When it was announced that Deere had become a new Berkshire holding, it was also reported that Warren Buffett's position in Johnson & Johnson was essentially eliminated. This news continues to put pressure on the stock, as investors re-evaluate their own positions. A few months ago, Buffett told CNBC that he believes too many mistakes have been made at the company and that he would sell some shares if he needed to raise capital.  While this comment could explain his recent move, the problem is that Berkshire is in no way hurting for cash. If you have an idea why Buffett sold Johnson & Johnson, sound off below and let everyone know. 

Foolishly investing
Although Caterpillar was down today, the company is the market-share leader in an industry in which size matters, and its quality products, extensive service network, and unparalleled brand strength combine to give it solid competitive advantages. Read all about Caterpillar's strengths and weaknesses in our brand-new report. Just click here to access it now.

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 22, 2012, at 8:06 AM, funfundvierzig wrote:

    Taking a broad perspective, DuPont continues its 21st century-long floundering and failing. This seemingly intractably troubled chemical conglomerate based in the dwarf state of Delaware is a victim of serial misfiring and missed opportunities by the Company's entrenched, inbred Management.

    Merely the opinion of one individual retail investor and DD shareholder...funfun..

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