Markets Bounce Back After Yesterday's Decline

Home Depot and Lowe's fall on weak housing data, but Walgreen and McCormick climb after posting strong results.

Mar 25, 2014 at 1:00PM
Longview Fool Image

After starting the week off lower, the three major U.S. indexes are mixed today. As of 1 p.m. EDT, the Dow Jones Industrial Average (DJINDICES:^DJI) was up 73 points, or 0.45%, the S&P 500 rose 0.24%, and the Nasdaq was down 0.06%.

Economic news this morning came in the form of the Conference Board's reading of consumer confidence, Case-Shiller Home Price Indices, and new home sales for February. The Conference Board's 82.3 reading indicated consumer confidence was up in March after February's reading of 78.3. The Present Situation index moved lower, but the Expectations index rose higher, which is a good sign for the future.  

The Case-Shiller index indicated that housing prices in January rose by 13.5% in the 10-city composite and 13.2% in the 20-city composite when compared to the same time frame the previous year. While the 10-city composite remained relatively the same when compared to recent months, the 20-city composite fell 0.1% for its third consecutive monthly decline.  

New home sales for February came in at a seasonally adjusted 440,000, below analysts' expectations of 445,000 and a 3.3% drop from the previous month. Both the new homes sales figure and the Case-Shiller reading indicate that the housing market is weakening, which is not a good sign for the economy or home improvement chains such as Home Depot (NYSE:HD) or Lowe's (NYSE:LOW). Shares of Home Depot are down 0.4% while Lowe's is off by 1.6% today. The two companies need a strong spring, which is when most home improvement projects take place. But if housing data doesn't soon improve, and consumers confidence doesn't rise, homeowners may hold off on putting more money into a diminishing asset, thus hurting the retailers' sales figures.

Meanwhile, Walgreen (NASDAQ:WBA) shares were up 2.4%. The company's quarterly report, issued before the opening bell today, showed sales of $19.6 billion and earnings $0.91 per share. Analysts were looking for revenue of $19.61 billion and earnings per share of $0.93. Earnings also came in lower than the $0.96 per share reported for the same quarter last year. The good news, though, was that same-store sales rose 4.3% and overall sales were up by 5.1%.  

Another big winner after reporting quarterly results this morning was spice company McCormick (NYSE:MKC). Shares were up nearly 6% after the company posted revenue of $993 million and earnings per share of $0.62. Wall Street was looking for sales of $973.2 million and earnings per share of $0.58. Management believes sales will grow between 3% to 5% during this fiscal year. Investors flock to this stock because of it operates in a boring industry and offers stable growth and a solid dividend.  

More Foolish insight

3 stocks to own for the rest of your life
As every savvy investor knows, Warren Buffett didn't make billions by betting on half-baked stocks. He isolated his 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. 

 
 
 
 

Matt Thalman owns shares of Home Depot. The Motley Fool recommends Home Depot. 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.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers