The Dow Jones Industrial Average (DJINDICES:^DJI) is down along with the Chinese markets after the Chinese government announced new measures to cool the country's real-estate market. As of 1:25 p.m. EST the Dow Jones Industrial Average is down 16 points, or 0.11%, to 14,074. The S&P 500 (SNPINDEX:^GSPC) is down 0.1% to 1,517.

There were no U.S. economic releases today. While the U.S. was focused on the sequester on Friday, the Chinese government announced new policies to curb speculation in the Chinese real-estate market. These policies include higher down-payment requirements and higher mortgage rates on second homes. The new measures pushed down Chinese stocks. The Shanghai Composite Index fell 3.7%, the Shenzhen Composite Index fell 3.5%, and Hong Kong's Hang Seng Index fell 1.5%. The Chinese markets were led down by property developers and other industries related to real estate. The drop would likely have been higher if not for the one-day drop limit of 10% that the government has set for stocks. Companies that hit the limit are very likely to fall further tomorrow.

Seventeen of the 30 Dow stocks are in the red so far today, led down by cyclical stocks -- companies whose results largely depend on the strength of the economy. Caterpillar is leading the decline, followed by United Technologies and Alcoa.

Today's Dow leader
Today's Dow leader is Merck (NYSE:MRK), up 1.2%. Merck fell nearly 1% last week after a study linked Merck's diabetes drug Januvia to pancreatitis. Januvia made up nearly 10% of Merck's pharma sales in 2012, tying it for second with Singulair in terms of contribution to Merck's revenue. Gardasil, Merck's drug for treating HPV, makes up nearly 50% of Merck's pharma sales.

Perhaps investors believe the market overreacted to the Januvia news. Pharmaceutical companies typically do not move in line with the market, as their results are not heavily influenced by how the economy does.