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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.
When the closing bell rang today, the Dow Jones Industrial Average (DJINDICES: ^DJI ) was up 26 points (0.18%), the S&P 500 was higher by 0.95 points (0.06%), and the Nasdaq was down 17 points (0.46%). The mixed results from the major indexes all prove that while some investors became bullish after President Obama nominated Janet Yellen, others still have serious concerns about the government shutdown and, more importantly, the debt ceiling debate.
With all the uncertainty in the markets, long-term investors should prepare their portfolios for a rocky road ahead and begin picking stocks when prices are low enough.
A few Dow losers worthy of consideration
Shares of McDonald's (NYSE: MCD ) lost 0.71% of their value today after rival Yum! Brands (NYSE: YUM ) reported poor results yesterday after the closing bell. Yum! announced third-quarter earnings of $0.85 per share, below the $0.92 analysts were looking for and warned that same-store sales during the fourth quarter in China would not be back in positive territory (something it had previously told investors would happen). While some believe McDonald's recent push into chicken wings and other menu items may be hurting Yum!'s KFC brand, the same-store sales warning from Yum! is likely causing other McDonald's investors some heartburn. The lack of growth in China may be an indication that McDonald's may also miss growth estimates there.
Boeing (NYSE: BA ) dropped by 0.84%. The move comes at a time when Norwegian Air Shuttle announced that it plans to take one of its two Boeing 787 Dreamliners out of service soon. The decision to ground the plane comes after the airline had problems with its other 787 and sent it back to Boeing to have it repaired and examined. The move is just a precautionary one, but it once again signals to investors and other airlines that the 787 still has problems.
Disney (NYSE: DIS ) was a big loser as well, with its shares falling by 0.64%. With all the negative sentiment swarming around the government shutdown and the debt ceiling debate, investors may be concerned that the entertainment company will be affected by the turmoil. As consumers worry more about the health of the U.S. economy, they may slow spending and one of the easiest things to cut back on are entertainment dollars. Disney's movie revenue, theme park attendance, and certainly merchandising revenues could all take a hit in the coming months.
In other Disney news, it recently announced that it would no longer offer paper stock certificates as of October 16. While this may be a sad day for collectors, it will have no negative impact on the company.
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