Mixed Economic Signals Cause More Uncertainty, Fear

After we experience a day like today, not much can be said. The markets pulled back after being hit by a storm of economic data reports, which were both good and bad. The jobs number likely stands out as the worst, but it by no means singlehandedly caused today's decline. Other were the crude inventory levels report, the Fed's Beige Book release, factory inventories, issues in Japan, the Productivity and Cost report, poor mortgage loan applications. The list goes on.

What it all amounted to was increased levels of uncertainty about where the market is heading and what the Federal Reserve will do during with its bond-buying programs. This heightened level of uncertainty increased fear and led investors to sell the market off. As a result, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) lost 216 points, or 1.43%, while the S&P 500 (SNPINDEX: ^GSPC  ) fell 1.38% and the Nasdaq declined by 1.27%. All but one of the Dow's 30 components ended the day higher while the S&P 500 heat map looked covered in blood.

With the markets red nearly across the board, a number of stocks have just been pulled lower by the tide. That is likely the case with Walt-Disney (NYSE: DIS  ) today, which lost 1.91% during the regular trading session. My Foolish colleague Dan Carrol noted earlier that Disney currently has the fifth highest-grossing film of all time with Iron Man 3. I should note that the movie is still in theaters, but based on the most recent numbers, it has brought in more than $1.1 billion in ticket sales. Furthermore, with a great pipeline to produce new films, parks, TV shows, and merchandising deals, the company not only makes money on the film but the whole franchise when it knocks out a blockbuster movie. Disney shareholders shouldn't worry about today or any other mild pullback. The company is performing well and will likely continue to do so for many years to come.  

Earlier this afternoon, I discussed why JPMorgan Chase was likely declining. Now, let's take a look at what caused Bank of America (NYSE: BAC  ) to fall 1.95% today. Similar to JPMorgan, the bank is under pressure due to a large loss the financial institution will likely take in the coming weeks or months. B of A is in the midst of a legal battle, which, if all goes well, will only cost the company $8.5 billion. I say only because some analysts peg the possible loss at around $60 billion. The bank is currently attempting to convince a judge to approve the $8.5 billion settlement. If the judge doesn't, the price will definitely start moving higher.  

Shares of Intel (NASDAQ: INTC  ) dropped 2.6% today after an analyst from JPMorgan Chase warned investors that the company's second-quarter results may be lower than expectations due to the weakness we have seen and will likely continue to see in the PC industry. While this is a very valid point, Intel has recently made some big moves into the mobile computing market, which will help the company long term. And investors should be focusing on what their investments will do over the next one-, five-, or 10-year periods, not the next week, month, or quarter.  

More Foolish insight

It's easy to forget that Walt Disney is more than just the House of Mouse. True, Disney amusement parks around the world hosted more than 121 million guests in 2011. But from its vast catalog of characters to its monster collection of media networks, much of Disney's allure for investors lies in its diversity, and The Motley Fool's premium research report lays out the case for investing in Disney today. This report includes the key items investors must watch as well as the opportunities and threats the company faces going forward. So don't miss out -- simply click here now to claim your copy today.


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.

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: 2474314, ~/Articles/ArticleHandler.aspx, 10/25/2014 11:55:48 PM

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...


Advertisement