With the fiscal cliff just five days away and no solution to avoid falling over the edge, the Dow Jones Industrial Average (DJINDICES:^DJI) continued its losing streak for a third day. Although investors have not totally lost faith that a compromise is possible in Washington, most seem reluctant to add new capital to the markets with so much uncertainty looming. It is widely believed that if we go over the cliff, the U.S. will fall into another recession and the markets will quickly tumble. Today, 17 of the Dow's 30 components were in the red and the index closed the day down just 24 points, or 0.19%, and now sits at 13,114.
This afternoon, I explained why shares of Home Depot (NYSE:HD), United Technologies (NYSE:RTX), and Walt Disney (NYSE:DIS) all moved lower. Read about what caused those stocks to fall by clicking here or stick around to learn why American Express (NYSE:AXP), Wal-Mart (NYSE:WMT), and UnitedHealth (NYSE:UNH)dropped.
So why did they fall?
Shares of both American Express and Wal-Mart slid lower by 0.7% and 0.85%, respectively, today. The Dow's only credit card company and largest retailer both fell due to a report released by MasterCard today. Analysts there said that retail sales during the holiday shopping season rose a mere 0.7% this year. This represents the slowest growth since 2008.
Understandably, Wal-Mart's shares would drop based on this news. Slower overall retail sales growth means that the company will also likely realize reduced profit growth. That is not something investors like to see.
Since American Express makes money from the transaction fee that retailers pay every time a cardholder uses its credit card and a percentage of the total transaction amount, again slow growth in sales indicates the card company will see slow growth in revenue. While at this time investors only have the big picture number, shareholders of either company should hold off on selling until they see company-specific sales numbers at the end of the quarter.
Lastly, shares of UnitedHealth led all Dow stocks lower today as they dropped by 1.15%. The health-care company has been under pressure for the past six months as shares have lost 7% of their value. The main driver pushing the stock lower is the possible cut to Medicare outlays in 2013.
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