Why Boeing, Home Depot, and Wal-Mart Pulled the Dow Down Last Week

The Dow suffered a setback for the first time in a while, and these stocks helped stop a record run for the average.

Jun 14, 2014 at 5:02PM

The Dow Jones Industrials (DJINDICES:^DJI) did something they haven't done in a while this week: post two triple-digit losing sessions on the way to a 150-point loss on the week. Even though the decline represents less than a 1% pullback on the Dow, it's still the worst weekly performance the Dow has had since early April, showing just how impressive the stock market's bull run has been during the second quarter. Among the biggest decliners this week were Boeing (NYSE:BA), Home Depot (NYSE:HD), and Wal-Mart (NYSE:WMT).

Source: Boeing.

Boeing fell more than 4% as the aerospace giant faced the twin prospects of a slower global economy and industry-specific headwinds as well. Boeing has benefited greatly from the rise of the airline industry, which has emerged from decades of weak performance and consistent bouts of bankruptcy filings to become immensely profitable. But even high-flying airline stocks have started to show some weakness as the bull market ages, and the pace of new orders has been so strong in recent years that it'd be almost impossible for Boeing to keep it up for the foreseeable future. Boeing's long-term prospects still look promising, but they're contingent on the airline industry figuring out how to perpetuate its recent success rather than falling back into their old money-losing patterns.


Home Depot dropped 3% as investors weighed the potential impact of economic sluggishness on the housing market. Interest rates have been stubbornly low so far in 2014, and that has helped keep mortgage rates down and make housing more affordable for would-be homebuyers. That in turn should help support Home Depot's growth, especially in light of pent-up demand from shoppers who had to delay gardening and home-improvement projects due to the long winter. Yet nervousness that rates will eventually have to rise and that the housing market could finally start to see some weakness creep in weighed on the stock this week, and investors will simply have to wait for the home-improvement retailer's next earnings report to see if Home Depot can keep bucking the trend and finding new ways to grow.

Wal-Mart gave up about 2.5%, with one of the factors being possible consolidation in the deep-discount retail space. Carl Icahn targeted a prominent dollar-store chain by taking a 9% in the company, seeing the potential for dollar stores to challenge traditional discount department stores like Wal-Mart. That strategy has some merit, especially in light of the challenges that Wal-Mart has had in an economic environment that should actually play to the retailer's strengths. If Wal-Mart keeps facing challenges from both sides of the income spectrum, then it could find itself squeezed out, and the company needs its efforts on the e-commerce front to bear fruit in order to fend off competition from that angle as well.

Will this stock be your next multibagger?
Give us five minutes and we'll show how you could own the best stock for 2014. Every year, The Motley Fool's chief investment officer hand-picks one stock with outstanding potential. But it's not just any run-of-the-mill company. It's a stock perfectly positioned to cash in on one of the upcoming year's most lucrative trends. Last year his pick skyrocketed 134%. And previous top picks have gained upwards of 908%, 1,252% and 1,303% over the subsequent years! Believe me, you don't want to miss what could be his biggest winner yet! Just click here to download your free copy of "The Motley Fool's Top Stock for 2014" today.

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 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.

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