We've always known the Spaniards to be tremendous bullfighters, but an even more effective matador has entered the scene: fears about Spanish debt. Traditional etiquette dictates a bit of a show before killing the bull, but with Spanish bond yields ticking above 7%, the market seems too worried to even put a bull in the ring. You'll be forgiven if you expected the news about this weekend's Greek elections resulting in a pro-bailout coalition government to spark a bull run today; I sure did. Instead, the market seemed firmly focused on Spain's own crisis as the potential next shoe to drop of sorts and actually sent shares of the Dow Jones Industrials Average (INDEX: ^DJI) down 0.2% today.
Big news is ... no news?
You know it's a decidedly "blah" day on the Dow when your biggest winner is Kraft (NYSE: KFT), up only 0.88%. The company does earn 24% of its revenue from Europe, though, so maybe that's the reason? Apparently not, since General Electric (NYSE: GE), which collects 28% of its revenue from Europe, was actually down 1.25%, the fourth biggest drop on the index today. McDonald's (NYSE: MCD) too, which at 39% of revenue counts Europe as its largest market, was also inexplicably down for the day, falling 0.29%.
So what was the exciting catalyst for Kraft's "run" today? The food company announced that it will switch exchanges from the NYSE to the Nasdaq. Yep, that's the biggest, most influential news on the Dow after the Greek elections this Sunday. The market sure is a strange place. Kraft's symbol will stay the same until its planned spinoff into two companies, at which point their symbols will become KRFT and MDLZ for Kraft and Mondelez International, respectively.
This is a big vote of confidence for Nasdaq after the botched Facebook (Nasdaq: FB) IPO. The failed debut has left a bad taste with most investors, discouraged other tech IPOs, and bruised the credibility of Nasdaq's management. Apparently the Nasdaq folks have made nice with the markets again, and they'll be setting aside $40 million to iron out bungled Facebook orders.
How to play it
Many investors expected the news of the Greek turnout to spark a big day on the Dow, but just the opposite happened. If anything else, this just highlights the impossibility of market timing. No matter how good we think we are, trying to guess where it will land on a given day is akin to throwing darts.
That doesn't mean you can't still beat the market, though. In fact, if you pick up shares of great companies and settle in for the long run, you can absolutely decimate it. Fortunately, some incredible investors have already done the hard work of finding these companies, making them The Stocks Only the Smartest Investors Are Buying. These smartest investors aren't Joe and Jane hedge fund managers, either, but none other than Warren Buffett. You can learn where he parks his cash, and the stocks he probably wishes he could buy.
