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.
The highly anticipated gross domestic product numbers came out today, giving investors a snapshot of how the economy is coming along. As it turns out, third-quarter growth was pretty solid, with GDP logging a 2.8% advance in the third quarter. The steady growth took investors by surprise, though the good news was interpreted as bad news by Wall Street. Speculation over the Federal Reserve's $85 billion monthly stimulus program -- specifically, how long that program will continue -- has a firm grip on the psyche of the market. With worries swirling that the economy's progress may tighten money supply, the Dow Jones Industrial Average (DJINDICES: ^DJI ) slumped 152 points, or 1%, to end at 15,594.
Walt Disney (NYSE: DIS ) stock sure didn't help prop up the Dow, as the entertainment giant fell 2.7%. While some degree of volatility can always be expected in the hours leading up to a company's quarterly earnings (Disney reported after hours), today's slump came on the heels of another major announcement. According to The Wall Street Journal, Disney-owned Marvel will be teaming up with video streaming service Netflix to bring four original series -- based on characters in the Marvel universe -- to the popular Internet platform. Awesome, right? Not to investors, apparently, who may have expected a more exclusive deal that also included movie rights. You just can't please everyone all the time, can you?
Speaking of not pleasing everyone, shares in fast-food giant Wendy's (NASDAQ: WEN ) cratered 11.4%, pleasing only those coldhearted enough to short a company with the logo of a lovable redheaded little girl. Innocent cartoon children aside, investors are in the game to make money, and Wendy's third-quarter results didn't impress on that front. Sales only rose about 1% in the period, missing analyst expectations. As far as net income is concerned, Wendy's essentially broke even. The chain will have to hope its new Pretzel Bacon Cheeseburger continues to impress consumers; the ambitiously crafted burger has done quite well since its inception.
Lastly, shares of J.C. Penney (NYSE: JCP ) surged 5.6%, as stock in the clothing retailer continues its roller-coaster ride. Today's swing, savvy investors will be pleased to hear, was driven by some very meaningful new data today straight from the company itself. After J.C. Penney stopped providing monthly sales data last year (in fairness, it isn't required to), it resumed the practice today. Same-store sales grew from September to October, a truly welcome relief for shareholders, who've seen consistently plummeting revenue in recent years. Looking forward, let's hope these monthly disclosures keep coming, as they'll give shareholders a better idea of how a J.C. Penney turnaround is progressing.
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