Gaining 0.5%, the S&P 500 Index (^GSPC +1.46%) set a new record close today, as the government of Cyprus reached a deal that allows the small, desperate Mediterranean country some much-needed extra time to meet bailout requirements. Even as the benchmark index reaches all-time highs, three stocks in particular still managed to fall off a cliff Tuesday.
While yesterday saw chip-making companies suffer across the board, today oil refiners finished the day as notable underperformers; shares of Valero Energy (VLO 6.88%) in particular stood out, slipping 5.7%. The decline follows an announcement from a company spokesman that Valero will have to spend between $300 million and $400 million on new equipment. The new equipment isn't just an impulsive expense; the Environmental Protection Agency's new sulfur standards for gasoline mean refiners will need better technology to keep up with the law.
Marathon Petroleum (MPC 5.65%) will probably be in the same boat as Valero, a sentiment that sent shares of the refiner 4.8% lower. The EPA said that refineries should be able to reduce sulfur content from 30 parts per million to 10 parts per million with no problem, but investors seem to think that's a little optimistic, judging by today's sell-off. While both Valero and Marathon had rough days today, their stocks have done remarkably well in 2013, so some profit-taking may be involved with the declines today.
Southwest Airlines (LUV +4.58%) was also a victim of structural industrywide issues: Delta Air Lines (DAL +3.50%) ruined it for other airlines today, as sales disappointed in March. Taking a cue from Delta, Southwest dropped 4.2% Tuesday. The company is set to report quarterly earnings April 25, and with its AirTran merger set to come to a close this month, now is a time of major changes for the airline.
