Why the Dow Took a Step Back Today

Perhaps it was time to take a step back. With little impactful economic news hitting the wires today, markets cooled from a red-hot start to the year on Monday. If anything, a slight slowdown in December housing numbers may have even restored a hint of bearishness to Wall Street. That said, by day's end the Dow Jones Industrial Average (DJINDICES: ^DJI  ) had fallen just 14 points, or 0.10%, to 13,881.

While the real estate sector dealt with less than spectacular data, manufacturing was a different story. Industrial mainstays got a boost today as December durable goods orders rose 4.6%. Caterpillar (NYSE: CAT  ) investors happily bid the stock 2% higher, as the positive indicator combined with better-than-expected earnings results to paint a pleasant picture of what's to come. Caterpillar was the Dow's biggest gainer on Monday.

Alternatively, Alcoa (NYSE: AA  ) was the worst performer in the blue-chip index, sliding 1.4% as materials stocks declined. W?ith shares having already advanced nearly 6% in 2013, investors worry that the market may be getting ahead of itself from a valuation perspective. Nothing overwhelmingly negative was revealed about the aluminum business in particular today; Alcoa was just one of 18 blue chips to sell off to start the week. 

Shares of 3-D printing pioneer 3D Systems (NYSE: DDD  ) suffered a precipitous drop Monday, falling 13.9%. Here too, reasons for the fall were not outwardly evident, but the drop was likely due to growing concerns that investors have placed too much of a premium on the high-growth 3-D printing industry. Shares in competing company Stratasys also tumbled about 10% today.

Another high-growth business, beverage newcomer SodaStream (NASDAQ: SODA  ) fell 4.3% today. The stock, trading near 52-week highs after a run-up of about 40% in the past few months, worries some that there isn't much room left for further gains. Still, with no debt and a promising business model, SodaStream might not be in as dire straits as some on Wall Street believe.

It's no huge surprise Caterpillar rose 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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