Image source: Cummins.

Tuesday was a solid day for the stock market, which saw the Nasdaq Composite close at a new record level and other major market benchmarks climb by about a quarter percent. Investors appear to be increasingly comfortable that the Federal Reserve will once again delay boosting a key short-term interest rate when its monetary policy board meets later in September, and new data pointed toward further weakness in the economy that lent support to the argument that the central bank should be cautious before tightening. Oil, gold, and other commodities celebrated the news, but some stocks didn't fare as well. Among the worst performers were Cummins (CMI 0.38%), Centene (CNC -0.15%), and Iridium Communications (IRDM 0.43%).

Cummins gets spooked by M&A activity

Cummins fell 7% in the wake of news that auto giant Volkswagen had taken a sizable equity stake in truck-maker Navistar International. As an engine specialist, Cummins supplies engines to companies like Navistar, and investors are concerned that Volkswagen will likely seek to sell its own engines to Navistar as part of its partnership. Navistar wouldn't be the first company to seek other sources for its engines, but the fundamental question that Cummins faces is whether it can continue to exist as an independent supplier if more manufacturers of trucks start to integrate their own engine-manufacturing capabilities in-house. Investors are concerned about the potential fallout, and Cummins might have to find a different strategy in the long run if the industry trend toward bringing production in-house continues.

Centene gets a downgrade

Centene dropped 5% after the company got a downgrade by analysts at Leerink Partners. The analysts cut their rating from outperform to market perform, citing concerns about its ability to match what most investors expect from the health insurance and service provider's earnings over the next year. The company has benefited from expansion of Medicaid programs across dozens of states in recent years, but it's uncertain how much more Centene will be able to squeeze from that side of the business. Moreover, with other insurance providers having troubles with their Obamacare coverage, investors will want to see assurances that Centene will still be able to make money from its growth initiatives connected to the Affordable Care Act.

Iridium can't connect with shareholders

Finally, Iridium Communications declined 5%. The satellite communications company announced that it had sold 2,200 units of its Iridium Pilot system during the year that ended on June 30, showing its strong performance from the maritime industry. The company hopes that the use of the Pilot will bolster subscriptions to its Iridium OpenPort global broadband service, which Iridium said has climbed 9% over the same period. Yet Iridium is in the process of a major upgrade to its satellite network, and investor concerns about potential disruptions from launch failures have become heightened after a high-profile explosion last week. Until the Iridium Next network is complete, shareholders will have to wait and watch to see if the company's satellites successfully get put into orbit.