Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.
Another day, another record finish for U.S. stock markets, as strong performance from retailers encouraged investors and brought more money flowing onto Wall Street. Janet Yellen, the nominee to become the next chairman of the Federal Reserve, is also slated to speak before the Senate tomorrow, and her testimony may provide some insight into what monetary policy will be like under her reign. By the end of the day Wednesday, the S&P 500 Index (SNPINDEX:^GSPC) had added 14 points, or 0.8%, to end at 1,782, a new all-time record close.
While today was a nice day for retailers, it wasn't so kind to every corner of the markets. Regeneron Pharmaceuticals (NASDAQ:REGN) ended as one of the index's most severe decliners, falling 3.4%, as shares tumbled in reaction to new guidelines set by prominent U.S. medical organizations for cholesterol drugs. The American Heart Association and the American College of Cardiology announced their support of statins to treat cholesterol levels; another method of treatment are PCSK9 inhibitors, one of which Regeneron hopes the FDA will approve in the future. Investors are hoping that today's endorsement doesn't make that pipeline hope a pipe dream.
Meanwhile, shares of electric utility company FirstEnergy (NYSE:FE) lost 1.7% today, as some fallout continued in the stock price following bad news earlier this week. Monday saw ratings agency Moody's retain its negative outlook on FirstEnergy's debt, essentially ensuring that the company will continue to pay elevated rates to creditors for the time being. So long as FirstEnergy's default risk remains where it is now, the cost of capital shouldn't change too dramatically, but if its debt ebbs below investment-grade, you may want to steer clear of these shares.
Lastly, DuPont (NYSE:DD) stock shed 1.1% Wednesday, though much of the decline can be chalked up to circumstances surrounding the company's dividend as opposed to underlying issues with execution or diminished prospects. The chemical giant chooses to return money to shareholders through a dividend, which currently sits at about a 2.9% annual rate. Shares went "ex-dividend" today, which means that anyone who owned DuPont shares at the market's close on Tuesday could have sold today and still received a quarterly dividend payment. Many investors chose to do just that, ridding themselves of the risk inherent in all stocks while guaranteeing themselves a small quarterly payment simultaneously.
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