Intel and Cisco Lead the Dow Lower as Apple Shares Fall

The Dow Jones was falling early on Thursday, along with several major tech companies, including Intel, Cisco, and Apple

Jan 2, 2014 at 11:20AM

The Dow Jones Industrial Average (DJINDICES:^DJI) was down early on Thursday, falling more than 86 points as of 11:30 a.m. EST. Intel (NASDAQ:INTC) and Cisco (NASDAQ:CSCO) were some of the index's worst performers, while fellow tech giant Apple (NASDAQ:AAPL) shed more than 1%.

ISM meets expectations
There weren't many economic reports released early on Thursday, but those that were released were not particularly negative. The Institute for Supply Management Manufacturing PMI, a measure of manufacturing activity in the U.S., came in line with expectations: The reading of 57 was exactly what economists had anticipated.

The report indicates that the U.S. manufacturing sector grew for the seventh consecutive month. The reading might have been seen as a positive for the markets, but investors were evidently occupied with other matters.

Intel could suffer from continued PC slump
Shares of PC chip giant and Dow Jones component Intel had dropped more than 1.3% by late morning. Intel's underperformance may have been due to a recent note from analysts at Sterne Agee.

Sterne Agee continues to remain neutral on Intel, largely based on the outlook for traditional PCs. In particular, Sterne Agee expects first-quarter PC sales to be sluggish. That's obviously problematic for Intel; while the company has begun to aggressively target the mobile space, Intel continues to supply the majority of traditional PC processors.

Cisco underperforms
Cisco was another tech name tumbling on Thursday, falling nearly 2%. Unlike Intel, however, there wasn't any major news to justify Cisco's sell-off. Instead, investors may have been rebalancing their portfolios at the beginning of the year, selling Cisco and moving into other positions.

Although Cisco did finish positive in 2013, it underperformed the Dow in rising a bit more than 15%.

Apple hit by downgrade
The iPhone maker was down about 1.3% early in the session, a notable move for a company with a market cap of about $500 billion. Like Intel, the Apple sell-off may have been prompted by a research note. A Wells Fargo analyst downgraded Apple to kick off 2014, cutting the rating on the stock from outperform to market perform.

Wells Fargo found fault with Apple's gross margin. Previously, the bank believed the release of the iPhone 5s would propel Apple's gross margin higher as consumers upgraded to more expensive devices. However, at Apple's current valuation, Wells Fargo believes higher gross margin expectations are already built into the company's share price.

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Sam Mattera has no position in any stocks mentioned. The Motley Fool recommends Apple, Cisco Systems, and Intel. The Motley Fool owns shares of Apple and Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

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That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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