The Dow Jones Industrial Average
Japan is citing poor consumer spending as the cause for the slowdown, and right now the Dow is the weakest of the three major exchanges. That's expected, given the Dow's hefty consumer goods weighting when compared to indexes like the S&P 500
|Dow Jones Industrial Average||(60.1)||(0.49%)||13,147|
Source: S&P Capital IQ.
Industrials are also dragging the Dow down today. The sector also has about twice the weighting compared to other indexes, and given that much of Japan's recent GDP growth was fueled by reconstruction, it's easy to see why industrial heavies Alcoa
Asia is a key growth market for Caterpillar going forward. The region is already the company's second-largest by revenue and has consistently outpaced the growth of their other segments. Filling a void created by the spending decrease from Japan isn't easy, but in Caterpillar's case there may be a silver lining.
Japan is also experiencing a rapidly rising currency. The yen is trading near all-time highs compared to the U.S. dollar and the euro, which could make Caterpillar more competitive with Komatsu, the Japanese construction equipment manufacturer and most legitimate competitor to Caterpillar in China.
The rising yen could be equally beneficial for the domestic auto manufacturers Ford
You shouldn't make the decision to invest in Ford or Caterpillar on this news alone, though.
There are much larger considerations for both investments. Our top analysts will tell you exactly what you need to know about both companies, and whether you should buy or sell them today, in our premium Ford and Caterpillar reports. Click here to read whether Ford will crash your portfolio, and click here to read about Caterpillar's three biggest catalysts.
Austin Smith owns shares of Ford. The Motley Fool owns shares of Ford. Motley Fool newsletter services have recommended buying shares of Ford and General Motors. Motley Fool newsletter services have recommended creating a synthetic long position in Ford. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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