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.
For five days in a row, the Dow Jones Industrials (DJINDICES: ^DJI ) posted daily losses, yielding under the pressure of international economic concerns, the ongoing earnings season, and the perception that the stock market is overdue for a major correction. Yet today, the Dow gave investors some respite from those woes, with the average climbing more than 90 points to break its five-day losing streak. Among the Dow's stocks, Pfizer (NYSE: PFE ) and Visa (NYSE: V ) led the way higher for the average, while DuPont (NYSE: DD ) was among the weaker performers in the Dow.
Pfizer jumped 2.6% after its fourth-quarter report included a solid gain of 22% in its adjusted earnings per share. Patent-cliff issues continued to weigh on the company's revenue, which fell 2% from year-ago levels. But a combination of success with some of its cancer treatments as well as cost-cutting on the expense side contributed to the favorable results. Moreover, even though Pfizer expects further declines in revenue in 2014, it believes that earnings should remain relatively stable on an adjusted basis, and the company reiterated its expectations of making substantial share repurchases of about $5 billion this year.
Visa climbed 2.2% in advance of its own earnings report later this week. Visa had been hit especially hard due to emerging-market concerns, as a potential financial crisis could prove devastating to the credit card network giant's growth hopes around the world if current concerns spread beyond relatively minor markets like Turkey and Argentina. As long as any emerging-market effects don't spread to larger markets and begin to affect the U.S. economy and other major economic powers, though, Visa should be able to sustain enough growth to satisfy investors.
DuPont dropped 1.1% in the aftermath of its quarterly report today. Despite beating estimates with earnings-per-share that nearly tripled from year-ago levels, and despite announcing a $5 billion stock buyback program, DuPont disappointed investors with future revenue guidance that was below what they had expected. With the company looking for just 4% growth in sales for 2014, DuPont needs to move quickly in its efforts to separate out its performance-chemicals segment and concentrate on its faster-growing ag business if it wants to satisfy growth-hungry shareholders.
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