Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Unemployment Claims Fall, but So Does the Dow

After the markets were hit with a number of both positive and negative economic data points today, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) is down 16 points, or 0.12%, to 13,967. The other major indexes are also flat, with the S&P 500 and the NASDAQ both hovering within a point of breakeven.

The weekly first-time unemployment claims were released today, showing a drop of 27,000 from the prior reporting period. The seasonally adjusted 341,000 is the lowest reading in the past three weeks, and the four-week average now sits at 352,500. This good news was outweighed by negativity around the globe: GDP fell to an annualized rate of 0.4% in Japan, while the eurozone experienced a decline in GDP of 0.6% in the fourth quarter.

Who's down on the Dow?
The Dow telecom stocks are taking it on the chin today: Shares of AT&T (NYSE: T  ) and Verizon (NYSE: VZ  ) are down 0.9% and 0.7%, respectively. My Fool colleague Jessica Alling noted earlier today that AT&T and other DSL providers are embroiled in a patent-infringement suit brought on by Intellectual Ventures. This could be causing the stocks to fall, but I believe this is more of an industrywide decline related to the announcement that CenturyLink (NYSE: CTL  ) is cutting its dividend by 25%. The company will be reallocating capital from its dividend program to share repurchases and debt reduction. While CenturyLink is a local, land-based telecom service provider, investors expect high dividend yields from the entire industry, and whenever a company cuts its dividend, investors become nervous that others will follow suit.

Cisco Systems (NASDAQ: CSCO  ) is currently the Dow's worst-performing stock of the day, with shares down 1.2%. The company announced quarterly earnings last night that, on most levels, looked strong. The company beat analysts' expectations on earnings per share and hit expected revenue dead-on. But the shares are likely falling because of gross margin and operating margin declined during the quarter. Get the full run-down on the earnings report by clicking here.

More Foolish insight
Are you at ease...or nervous? It's been a great five-year run for investors, with the Dow and S&P at or near all-time highs. Yet fears abound. When will the next downturn hit? Will political gridlock lead to portfolio-killing inflation? To learn how to protect your portfolio, click here for free guidance from the Motley Fool Pro Academy

Read/Post Comments (0) | Recommend This Article (6)

Comments from our Foolish Readers

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.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2256345, ~/Articles/ArticleHandler.aspx, 10/1/2016 8:31:47 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 11 hours ago Sponsored by:
DOW 18,308.15 164.70 0.91%
S&P 500 2,168.27 17.14 0.80%
NASD 5,312.00 42.85 0.81%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/30/2016 5:01 PM
^DJI $18308.15 Up +164.70 +0.91%
CSCO $31.72 Up +0.33 +1.05%
Cisco Systems CAPS Rating: ****
T $40.61 Down -0.12 -0.29%
AT and T CAPS Rating: ****
VZ $51.98 Down -0.14 -0.27%
Verizon Communicat… CAPS Rating: ****
CTL $27.43 Down -0.09 -0.33%
CenturyLink CAPS Rating: **