4 Health and Tech Giants Missed the Dow's 100-Point Gain

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Investors breathed a sigh of relief today, focusing on the positive aspects of positive economic data rather than lingering on the potential impact that the favorable news might have on the Federal Reserve's decision about future interest-rate policy. Responding optimistically to news from China that the central bank there is handling its liquidity crunch with measured responses, as well as good economic data on the U.S. housing front, the Dow Jones Industrials (DJINDICES: ^DJI  ) took the opportunity to climb just over 100 points, making it the 10th triple-digit move in the past 11 trading days. Broader benchmarks moved upward even more aggressively, with the S&P 500 rising almost 1%.

Interestingly, several of the stocks from the health-care and technology industries that performed the best in yesterday's Dow decline were laggards this time around. On the health-care front, UnitedHealth (NYSE: UNH  ) fell 1.4%, giving up most of its gains from yesterday. Despite a recent dividend increase, and indications that the company is well-prepared to handle the full implementation of Obamacare, UnitedHealth is suffering from all the uncertainties investors have about the impact of Obamacare and other health-care policies on the health-insurance industry. With shares at a reasonable valuation of just 12 times trailing earnings, UnitedHealth offers some margin of safety against the potential for adverse news in the near future.

Merck (NYSE: MRK  ) also declined, with a 0.4% drop, even though the company won a legal battle against potential generic competition. As Fool contributor Dan Carroll noted earlier today, Merck got an injunction to protect its Januvia and Janumet diabetes drugs from an Indian company seeking to make generic versions of the drug. With the drugs having assumed the role of Merck's blockbusters, any threat has potentially large implications for the pharmaceutical company, which has already faced plenty of damage from past patent expirations.

On the tech front, both Microsoft (NASDAQ: MSFT  ) and Cisco Systems (NASDAQ: CSCO  ) fell modestly. Yet, both had interesting news, with Microsoft choosing to form a single venture-capital enterprise called Microsoft Ventures to foster promising start-up companies. The move takes what had been separate programs that had slightly different focus areas, and combines them into a single entity, arguably helping to make the venture's efforts more efficient. Meanwhile, Cisco traded higher earlier in the day, as an appeals court ruled in its favor in a case alleging that it infringed the patents of Commil USA, a small Texas company. The jury verdict had awarded Commil USA $63.8 million, but the appeals court will now send the case back to trial for proper handling of the legal issues involved.

A single day's losses aren't any big deal for any of these four companies. With advances for the stock market becoming harder to come by, though, it's important for stocks to take maximum advantage of any strong days they get.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.

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

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: 2509505, ~/Articles/ArticleHandler.aspx, 9/27/2016 5:05:23 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...

Today's Market

updated Moments ago Sponsored by:
DOW 18,228.30 133.47 0.74%
S&P 500 2,159.93 13.83 0.64%
NASD 5,305.71 48.22 0.92%

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

9/27/2016 4:45 PM
^DJI $18228.30 Up +133.47 +0.74%
CSCO $31.48 Up +0.41 +1.32%
Cisco Systems CAPS Rating: ****
MRK $62.57 Up +0.42 +0.68%
Merck and Co. CAPS Rating: ****
MSFT $57.95 Up +1.05 +1.85%
Microsoft CAPS Rating: ****
UNH $140.79 Up +1.07 +0.77%
UnitedHealth Group CAPS Rating: ****