The Dow Jones Industrial Average (DJINDICES:^DJI) posted a loss for the first time since the third week of June, as the index fell 232 points, or 1.48%, this past week. The blue-chip average now rests at 15,425 after hitting a new all-time high of 15,658 two weeks ago. Both the S&P 500 and the Nasdaq also posted losing numbers this week, down 1.06% and 0.79%, respectively. After getting an overwhelming amount of economic data two weeks ago, this week was comparatively slow, with only a few reports being released. But comments from a few Federal Reserve members on Tuesday made up for the lack of data and gave investors something to trade on this week.
Before we hit the Dow losers, let's look at this week's best-performing component. Shares of Alcoa (NYSE:AA) gained 3.13% this past week, far outpacing the second-best performer, Microsoft, at 2.54%. Alcoa's good week probably resulted from Thursday's release of Customs data indicating that Chinese exports rose 5.1% while imports increased by 10.9% in July, compared with the same month a year ago. This data is a welcome sign for investors that the world's second largest economy may have turned the corner on years of declining economic growth.
The big losers
IBM (NYSE:IBM) was the worst-performing Dow component this past week, losing 3.76% after being downgraded by analysts at Credit Suisse. Analyst Kulbinder Garcha cited a number of reasons for assigning a downgrade to "underperform," including weak demand in the IT consulting industry, the trend toward cloud storage and away from internal networking units, and problems with future organic growth.
Shares of Intel (NASDAQ:INTC) lost 3.05% this past week, making it the third worst performing Dow component over the past five trading days. It may come as a surprise that Intel performed so poorly when Microsoft moved higher this past week, since both companies are heavily involved in the struggling PC business, but Microsoft has a number of different units and business operations outside the PC industry, while Intel isn't as diversified. And although Intel is moving into the mobile chip market, it will be some time before investors see any real revenue and profit coming from that line of its business.
Finally, JPMorgan Chase (NYSE:JPM) lost 3.48% last week, after news broke that the bank may face new legal problems in the coming months. It's been reported that the Department of Justice is investigating the mortgage-backed-securities business of Bear Sterns, which JPMorgan purchased during the financial crisis. JPMorgan also has investigations pending for its own MBS unit and Washington Mutual's units, which JPMorgan picked up in the aftermath of the 2007-2008 market woes. These investigations could end up costing the bank a lot of money and put pressure on the stock price until they're all resolved.
The other Dow losers this week:
(For more information on why shares of some other losers fell lower this past week, click on the following links.)
- American Express, down 0.25%
- AT&T, down 2.71%
- Bank of America, down 2.62%
- Boeing, down 2.38%
- Chevron, down 1.96%
- Cisco, down 0.53%
- DuPont, down 0.3%
- ExxonMobil, down 1.33%
- General Electric, down 1.82%
- Hewlett-Packard, down 0.85%
- Merck, down 0.3%
- Pfizer, down 0.54%
- Coca-Cola, down 0.14%
- Travelers, down 2.26%
- United Technologies, down 1.99%
- Verizon, down 1.85%
- Wal-Mart, down 2.34%
- Walt Disney, down 2.67%
Fool contributor Matt Thalman owns shares of Bank of America, Microsoft, JPMorgan Chase, Walt Disney, and Johnson & Johnson. Check back Monday through Friday as Matt explains what caused the Dow's winners and losers of the day, and every Saturday for a weekly recap. Follow Matt on Twitter: @mthalman5513.
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