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.
The stock market ended a phenomenal week on a strong note, with major indexes trading higher into the last weekend before Christmas. A vote of confidence in the U.S. economy from the Federal Reserve earlier this week was followed by today's revision to third-quarter GDP numbers out of the Commerce Department. Third-quarter GDP growth had previously been estimated at 3.6%, but it turns out higher-than expected consumer spending puts that number closer to 4.1%. The S&P 500 Index (SNPINDEX:^GSPC) applauded the data, added eight points, or 0.5%, to end at another all-time closing high, 1,818.
Peabody Energy (NYSE:BTU) stock fell 4.7%, ending as one of the index's worst decliners despite the broader market's bullishness. Project stoppages and labor disputes have put a damper on results from operations this year, the company said yesterday. Peabody Energy lowered its estimates for earnings before interest, taxes, depreciation, and amortization, or EBITDA, for fiscal 2013 by $60 million-$80 million from the $1.07 billion to $1.15 billion level it previously expected.
Best Buy (NYSE:BBY) stock lost 4.1%, ending as the sole retailer on today's shortlist of laggards. A 4% stumble isn't so bad in the context of this year's 230% rally to recent highs. Best Buy has proven it's still able to compete with the big boys, and with a few days to go before Christmas, retailers are still hoping to attract last-minute shoppers with steep discounts. This competitive, promotion-driven environment, however, is keeping margins at a minimum as we approach some of the busiest shopping days of the year.
Lastly, shares of Cliffs Natural Resources (NYSE:CLF) shed 2.7%. Like Peabody, Cliffs Natural Resources is a coal miner, though it also produces iron ore. Last week, the company reached a six-year labor agreement with the United Steelworkers Union, which should bring some lasting stability to the company's labor relations. Cliffs has smartly positioned itself as a diversified materials company that markets two of the key ingredients in steel, which recently has served as a hedge for shareholders: since May, for instance, the price of iron ore is up more than 20% while coking coal is down 4%. As long as demand from China keeps up, Cliffs Natural should keep plenty busy.
Fool contributor John Divine has no position in any stocks mentioned. You can follow him on Twitter @divinebizkid and on Motley Fool CAPS @TMFDivine. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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