The Dow Closes the Week on an Up Note, But Wal-Mart, Home Depot Fall

The Dow Jones Industrials clawed back a bit of ground from this week's losses, but big retail stocks weighed on the average.

Jun 13, 2014 at 4:30PM
Longview

The Dow Jones Industrials (DJINDICES:^DJI) rose 41 points today but still suffered substantial losses on the week. Technology stocks were in the news for an unexpected boost in PC sales that led to more positive outlooks for chipmakers and collateral benefits throughout the industry. But big retailers held the Dow back from further gain, with Wal-Mart (NYSE:WMT) and Home Depot (NYSE:HD) among the index's weakest performers.

Wmt
Source: Wal-Mart.

Wal-Mart dropped 0.6% as investors continue to question whether the retail giant can turn around its struggling business both in the U.S. and around the world. Wal-Mart has put together a number of efforts to bolster its overseas growth, with plans to increase its Internet-retail presence in India later this summer and expectations for Latin American growth in e-commerce as well. Yet even as the Dow component acknowledges the competitive threat that online-only retailers present, Wal-Mart also must maximize the value of its massive retail-space footprint. Efforts in the U.S. to establish stores of varying sizes to meet the needs of particular localities could lead to more frequent visits and better sales overall. But Wal-Mart, even in a week in which some worries about the future of economic growth emerged, isn't inspiring the confidence among shareholders that it did during 2008's recession.

G

Home Depot, meanwhile, fell about half a percent. The most recent figures on retail sales earlier this week showed that the home-improvement sector continued to power forward, albeit at a slower pace than it did last summer. The pickup in sales from April to May signaled the hoped-for rebound for Home Depot and its peers after a long and unusually cold winter season, and it'll be especially important for Home Depot to take maximum advantage of the pent-up demand among its customers as long as it lasts. With clouds on the horizon in the housing market from an anticipated rise in mortgage rates, it's possible that Home Depot will have to overcome a sluggish housing sector in order to keep growing over the long run.

Consumers drive a good portion of the overall U.S. economy, and poor performance from the major retail stocks in the Dow Jones Industrials underscores the importance of healthy levels of activity in the broader economy. Dow investors should keep an eye on Home Depot and Wal-Mart to see if they avoid the full brunt of a future downturn -- or instead end up causing one.

Top dividend stocks for the next decade
The smartest investors know that dividend stocks simply crush their non-dividend paying counterparts over the long term. That's beyond dispute. They also know that a well-constructed dividend portfolio creates wealth steadily, while still allowing you to sleep like a baby. Knowing how valuable such a portfolio might be, our top analysts put together a report on a group of high-yielding stocks that should be in any income investor's portfolio. To see our free report on these stocks, just click here now.

Dan Caplinger has no position in any stocks mentioned. 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