Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.
This morning the Case-Schiller housing index was released, and while home price growth slowed in July, the numbers were still good in general. Year-over-year prices for the 20-city index rose 12.4%, which is the largest increase in nearly seven years. Some are calling the housing market another bubble, as we have seen 20% gains in prices in a number of cities around the U.S. this year, but if those are bubbles, it will likely be a contained inflation, as other areas of the country have seen more realistic growth of just a few percent.
The report has helped the Dow Jones Industrial Average (DJINDICES: ^DJI ) move slightly higher this afternoon, and as of 12:45 p.m. EDT the index is higher by 15 points, or 0.1%. The other major indexes are also slightly higher: The S&P 500 is up 0.16%, and the NASDAQ has gained 0.37%. Despite the Dow's slight gain, a few losers can still be found. Let's take a look at a few of them.
Shares of JPMorgan Chase (NYSE: JPM ) are down 1.1% today. This morning it was reported that talks between the bank and the Department of Justice to settle charges had broken down. The DoJ is bringing charges against JPMorgan related to mortgage securities the bank sold prior to the financial crisis. This also comes as Dick Bove, vice president of equity research at Rafferty Capital Markets, recently released a report in which he said regulatory and legal pressure will cost the bank $8 billion a year for the next few years. It's hard to deny right now that JPMorgan has a target on its back, but perhaps this is a good thing for the bank in the long run. If the firm is forced to clean up its act now, perhaps it won't have any more "London Whale" problems in the future.
Shares of Verizon (NYSE: VZ ) are down 1.2% after CEO Lowell McAdam told investors at a conference today that unlimited data plans are not sustainable. McAdam said, "If you allow unlimited usage, you will run out of gas." This follows the company's recent release of its Verizon Edge service, which is for customers who want to upgrade their phones on a more regular basis than the traditional two-year cycle and no longer offers the unlimited data plan. The new offering will be 6 gigabytes for $30 per month or 8 GB and the tethering option for $50 per month. While Verizon no longer offers the unlimited plan, any customer who already have the plan and switch to Verizon Edge will lose their unlimited data.
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