The Dow is Up as Financials Rebound and Tech Continues to Fall

The DJIA is up 94 points as financial stocks jump on better than expected consumer confidence data.

Jan 28, 2014 at 1:33PM

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 Dow Jones Industrial Average (DJINDICES:^DJI) is up 94 points, to 15,930, at 1:30 p.m. ET as stocks rebound after yesterday's fall. Financial stocks are leading the Dow higher, while the technology sector continues to drop after Apple (NASDAQ:AAPL)reported weaker than expected guidance. The S&P 500 (SNPINDEX:^GSPC) was up 10 points to 1,791.

Yesterday, financial stocks joined with technology stocks to push the Dow down. Today, though, financial stocks are rebounding. Technically, Pfizer is leading the Dow's rise today with a 2.9% rise, but because the Dow is a price-weighted index the drugmaker's low stock price means the company has a small effect on the blue-chip index. Visa (NYSE:V) is No. 2 for the day, up 2.1%. Its significantly more expensive stock price means Visa is having a seven times larger effect on the Dow today than Pfizer. Trailing Visa are American Express, General Electric, and JPMorgan Chase, which are all up just more than 1%.

There is no company-specific news for Visa's rise. The payment processor reports earnings on Thursday before the market opens. Financial stocks are up as the Conference Board's Consumer Confidence Index rose for the second straight month; it now sits at 80.7, above analyst expectations of 77.1. As confidence rises consumers are expected to spend more which means more transactions and more money for Visa. 

Technology stocks are continuing yesterday's fall after Apple reported weaker than expected guidance. While Apple is not a member of the Dow, as the world's largest technology company its actions, outlook, and movement have a large effect on the technology sector. Apple fell more than 7% after yesterday reporting first-quarter guidance of revenue of $42 billion-$44 billion. Analysts had expected the company to report a revenue guidance of $46 billion. Activist investor Carl Icahn is taking advantage of the lower stock price; he tweeted this morning that he had bought another $500 million shares, bringing his Apple stake to nearly $4 billion dollars. Icahn continues to advocate for Apple to buy back shares, while I believe that the company should pay out a large special dividend.

Carl Icahn and Warren Buffett didn't make billions by betting on half-baked stocks. They isolated their best few ideas, bet big, and rode them to riches, hardly ever selling. You deserve the same. That's why our CEO, legendary investor Tom Gardner, has permitted us to reveal The Motley Fool's 3 Stocks to Own Forever. These picks are free today! Just click here now to uncover the three companies we love. 

Dan Dzombak has no position in any stocks mentioned. The Motley Fool recommends Apple and Visa. The Motley Fool owns shares of Apple and Visa. 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." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

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.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

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.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information