This afternoon I noted that the markets were rather calm as investors waited for the Federal Reserve's announcement on how it would handle its Quantitative Easing programs moving forward. After the Fed released its intentions to keep a highly accommodative stance on monetary policy in the future, instead of rising on what seems to be good news, the Dow Jones Industrial Average (DJINDICES:^DJI) began falling and eventually closed down 2.99 points at 13,245.
In a nutshell, the Fed will continue to keep interest rates low as the economy improves and until the unemployment rate reaches a level it believes is suitable for the country. This afternoon, my Fool colleague John Maxfield explained in more detail the central bank's announcement, which you can find by clicking here.
At the end of the day, 13 of the Dow's 30 components were in the red. This afternoon I explained why 3M (NYSE:MMM), Wal-Mart (NYSE:WMT), and Boeing (NYSE:BA) were all moving lower. Click here to read about those companies, or stick around to see what caused the Dow technology companies to fall.
Why the Dow's tech stocks fell
This morning, a group of technology analysts from JPMorgan Chase released a report in which they reduced their estimates on 2012 corporate IT spending. The firm previously estimated industry growth of 1.9% and revised that number lower to 1.2% for the full 2012 year. With only a few weeks left in the year, these estimates are surely as accurate as an estimate can get. The analysts also projected 2013 IT growth at a rate of 1.7% and noted that both 2012 and 2013 IT growth will probably fall under the projected 2.4% global GDP growth.
Shares of IBM (NYSE:IBM) experienced the biggest decline when compared with the other Dow technology stocks, as it fell 0.64%. I believe this fall could have been fair worse for IBM if the company hadn't announced that it will be changing its retirement contribution plan moving forward. The company will no longer match 401(K) contributions monthly but will instead pay the funds in one large amount on Dec. 31 of each year. Employees who leave the company before that date won't get that year's contribution. This is seen both as a way to promote higher retention and save the company money. It will also allow IBM to invest money throughout the year and retain any positive returns it would earn on these investments made throughout the year.
Shares of Cisco (NASDAQ:CSCO) and Microsoft (NASDAQ:MSFT) were also down, by 0.2% and 0.29%, respectively, when the closing bell rang. Intel (NASDAQ:INTC), which saw its shares bounce around from positive to negative during the day, actually closed up 0.1% but were again trading in the red during the after-hours session.
Fool contributor Matt Thalman owns shares of Microsoft and JPMorgan Chase. The Motley Fool owns shares of IBM, Intel, JPMorgan Chase, and Microsoft. Motley Fool newsletter services recommend Cisco Systems, IBM, Intel, 3M, and Microsoft. 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.