Investors can't seem to make their minds up this week. For the second day in a row the Dow Jones Industrial Average (Index: ^DJI) has opened higher and then slid into the red. As of 12:30 p.m. the Dow sits at 13,300, down more than 25 points, or 0.19%. The index has lost more than 310 points, or 2.2%, since last Friday's closing bell. The big slide started on Tuesday, even before Alcoa released so-so earnings after the bell, when the market fell by 109 points. The market fell hard again on Wednesday, closing the day down another 128 points. Yesterday wasn't so bad, closing down a mere 20 points, except the Dow was up 82 points at one time during the day.
The crazy moves this week have not been constrained to the market as a whole; three Dow components are moving lower today because of how their competitors are performing and what they're saying.
Who is down and why?
Intel (Nasdaq: INTC) is trading lower by 0.23% this afternoon after Advanced Micro Devices (NYSE: AMD) cut its revenue forecast for the third quarter. Advanced Micro previously estimated a revenue decrease of 1%-3% in the third quarter. Now the company expects to see declines of 10%. Gross margins are also expected to decline to 31%, from the previous 44%, which management stated was primarily due to an inventory writedown of $100 million because of "lower anticipated future demand for certain products." While management's comments that demand is falling could be a concern for Intel shareholders, we will not know which products Advanced Mirco is having a difficult time selling until its full earnings release on October 18. Furthermore, Intel simply could be taking market share from the smaller chip maker, resulting in better-than-expected results for Intel.
Shares of Dow banking stocks JPMorgan Chase (NYSE: JPM) and Bank of America (NYSE: BAC) both are moving lower by 1.01% and 2.78%, respectively. Even though JPMorgan announced what seems to be favorable earnings results today, the company is still lower to due concerns raised over Wells Fargo's (NYSE: WFC) earnings report, which was also released this morning. Bank of America has been the best-performing Dow component this year, up more than 64% year to date. The company will announce earnings on October 17th, which is when investors will have a better idea about what is going on with the big banks.
