After a seven-day winning streak for the Dow Jones Industrial Average (DJINDICES: ^DJI ) , today may be the day when investors begin to take profits. As of 12:55 p.m. EDT, the blue-chip index is up less than a point, having traded within a tight range all day. There are more losers than winners on the Dow, but a big gain by Merck (NYSE: MRK ) is helping to keep the index afloat.
It's important for long-term individual investors to remember that day-traders, money managers, and other Wall Street types will begin taking profits now that the markets have run so high so quickly. If the Dow falls in the short term, don't panic or follow the herd off the cliff.
The S&P 500 is down 0.23%, while the NASDAQ has lost 0.4%.
Today's Dow laggards
The Dow's big pharmaceutical stocks are heading in opposite directions today. Shares of Merck rose by 3.3% after an independent monitoring board gave the company's cholesterol drug Vytorin a pass, allowing its drug trial to continue. This drug could be a blockbuster for Merck, similar to Pfizer's (NYSE: PFE ) Lipitor.
Speaking of which, Pfizer is seeing much less success today, with shares down 0.8%. Shares began falling this morning after the U.S. Food and Drug Administration released a warning that Pfizer's antibiotic Zithromax can cause a life-threating irregular heartbeat. A research study performed by The New England Journal of Medicine back in May concluded that Pfizer's drug carried a higher risk of cardiovascular death than various other antibacterial drugs.
Shares of Cisco (NASDAQ: CSCO ) are lower by 1.3% today after Standpoint Research downgraded the stock this morning from a buy to a hold. Cisco did recently hit a new 52-week high at $21.98, which may have prompted Standpoint's analysts to change their rating.
Another Dow stock moving lower after a recent downgrade is General Electric (NYSE: GE ) . Yesterday, Shannon O'Callaghan from Nomura Securities downgraded the stock from buy to neutral, although he kept his price target at $24 per share. General Electric's stock is currently down 1%.
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