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.
After cautiously edging higher on Tuesday, sellers were out in full force in the stock market today. Not only did new data show that builders broke ground on fewer homes than expected in January, but on top of that Federal Reserve policy makers have started debating when interest rates should start heading northward again. If there's one thing the stock market hates with consistency it's higher interest rates, and the S&P 500 Index (SNPINDEX:^GSPC) was no exception today, losing 12 points, or 0.7%, to end at `1,828.
Two out of every three stocks in the market managed to lose ground Wednesday, so United States Steel (NYSE:X) had some competition as it lost its way to the bottom of the S&P 500 today. Shares of United States Steel tumbled 7% after the Department of Commerce ruled, by omission, that South Korea is not exporting steel into the U.S. at less than cost, as U.S. Steel had alleged back in December. Still, after conducting its review, the government imposed tariffs on eight other countries to correct for unfair pricing, though a Korean tariff would have been seen as a huge win.
Coal and iron ore producer Cliffs Natural Resources (NYSE:CLF) shed 4% Wednesday as the volatile stock suffered repercussions from the broader market sell-off, an ex-dividend date, and pressure from an activist investor to change its corporate structure. Shares of Cliffs Natural Resources were already facing an uphill battle today because the stock went "ex-dividend," allowing anyone who owned shares at yesterday's close to sell them today and still receive the next quarterly dividend payment. Mix that in with a public debate about how to return cash to shareholders and a bearish market, and, voila: you've got a 4% decline.
Finally, Time Warner Cable (NYSE: TWC) stock, which was all over the news last week when Comcast announced plans to acquire it, dropped 2.8% today. While the $45 billion merger was first reported a week ago, it's not official yet, and is pending an FCC review. Lawsuits against Time Warner Cable and Comcast are beginning to pop up, and the deal is sure to get more media scrutiny in the days and weeks ahead. Although it's doubtful that lawsuits alone will impede the merger, whether the deal goes through or not, cable companies will need to address the growing competition that Google's Fiber network poses in the long-run, as the search giant expands its efforts to nine new urban areas.