Why the Dow Cratered 265 Points Today

Taking cues from a troubling and unexpected slowdown in China's growth, markets suffered their worst day in months on Monday. Two explosions near the finish line of the Boston Marathon this afternoon drove stocks down further as investors struggled to understand the attacks. The Dow Jones Industrial Average (DJINDICES: ^DJI  ) lost 265 points, or 1.8%, to close at 14,599.

All 30 Dow stocks lost ground today, and Procter & Gamble (NYSE: PG  ) ended as one of just five to lose less than 1%. Losing 0.5% was enough to earn P&G a spot among the day's top performers as the company raised its dividend by 7%, to an annual payout of around 3%. 

Industrials and energy stocks slipped on the Chinese slowdown, as the country saw its industrial production advance 9.5% in the first quarter. While that growth isn't shabby these days from a domestic standpoint, it's a 0.5% slowdown from last year's clip. China's GDP grew at 7.7% after growing by 7.9% in the fourth quarter. General Electric (NYSE: GE  ) ended Monday as one of the worst-performing blue chips in the index, losing 2.8%.

The jitters from Asia also sent oil to four-month lows, and shares of ExxonMobil (NYSE: XOM  ) slipped 2.8% as the price of oil dipped below $89 per barrel. Weak retail figures from the U.S. released earlier today meant that two of the world's largest oil-consuming economies may not have quite the demand for energy that markets have come to expect.

But Caterpillar (NYSE: CAT  ) shares ended as the Dow's worst performers, losing 3.3% today. Caterpillar is always deeply affected by shifts in global industrial trends, especially from China. Revenues from outside the U.S. accounted for about 70% of total consolidated sales for the company last year. With quarterly earnings set to come in next Monday, shareholders will be watching closely to see what impact Asia's recent weakness will have on results. 

Caterpillar 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 The Motley Fool's brand-new report. Just click here to access it now.


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