Why DuPont, Boeing, and ExxonMobil Led the Dow Lower This Week

These stocks pulled the Dow down from record highs.

Jun 28, 2014 at 5:02PM
Longview

The Dow Jones Industrials (DJINDICES:^DJI) lost just under a hundred points this week, dropping from the record levels where it started the week as investors worried about the possibility that the coming second-quarter earnings season won't go as well as companies hope. Despite relatively benign news during the week, DuPont (NYSE:DD), Boeing (NYSE:BA), and ExxonMobil (NYSE:XOM) posted the worst losses among Dow stocks over the past five trading sessions.

Dd
Source: DuPont.

DuPont dropped more than 4%, with nearly all of the losses coming on Friday after the chemical and agricultural-productivity company issued a dire earnings warning. Blaming an unexpected drop in demand for corn as farmers gravitated toward planting more soybeans, DuPont said that its earnings per share for the full year would come in $0.20 to $0.35 lower than anticipated, with a new range of $4 to $4.10 per share falling well short of where most shareholders expected to see the chemical company's results. Given the extent of the decline, investors are clearly worried that this is more than a one-time event, yet if DuPont can avoid duplicating the mistake next year, then the damage could be far less in the long run than today's share-price plunge would suggest.

Ba

Source: Boeing.

Boeing fell almost 3%, with declines coming steadily throughout the first part of the week. Most of the discussion about Boeing this week came in connection with the coming debate on reauthorization of the U.S. Export-Import Bank, which provides funding to foreign nations seeking to make major purchases of high-ticket items like aircraft. Boeing has historically benefited a great deal from the existence of the Export-Import Bank, and if the entity doesn't get reauthorization from Congress, then it could potentially cost the aircraft manufacturer more than $10 billion in sales, assuming would-be buyers can't find financing elsewhere. Commercial customers have largely been able to support Boeing's stellar growth recently, but nevertheless, losing the Export-Import Bank would be a sizable blow to Boeing's future prospects.

ExxonMobil declined 2.5% on an eventful week in the energy industry. News that the U.S. government had opened up export of crude oil turned out to be somewhat overstated, with the specific authorization allowing just two companies to send a limited amount of processed energy products overseas. Nevertheless, refinery stocks plunged across the board, and given the importance of Exxon's downstream operations as part of its overall business, the Dow energy stock felt the negative impact as well. At this point, the week's refining-led declines seem overblown, but it remains to be seen how the U.S. will react in the future to further attempts to open up crude-oil trade to international buyers.

Do you know this energy tax "loophole"?
You already know record oil and natural gas production is changing the lives of millions of Americans. But what you probably haven't heard is that the IRS is encouraging investors to support our growing energy renaissance, offering you a tax loophole to invest in some of America's greatest energy companies. Take advantage of this profitable opportunity by grabbing your brand-new special report, "The IRS Is Daring You to Make This Investment Now!," and you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.

Dan Caplinger and The Motley Fool have no position in any of the stocks mentioned. 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