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Last Week's Biggest Dow Losers

By Matt Thalman – Mar 22, 2014 at 11:00AM

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An in-depth look at what caused a few stocks to fall.

After falling more than 384 points two weeks ago, the Dow Jones Industrial Average (^DJI 0.96%) bounced back nicely this past week, gaining 237 points, or 1.47%. The S&P 500 and the Nasdaq also posted 1.37% and 0.73% gains.

The biggest single day for the Dow came on Monday, when the index rose 181 points as investors realized the issue in Ukraine wasn't going to start the next world war. The Dow's worst day came on Wednesday, after the Federal Reserve said it will cut its asset-purchase program, which began at $85 billion a month, down to $55 billion in April.

Before we get to the Dow's biggest losers of the week, let's look at its biggest winner. UnitedHealth Group (UNH 1.80%) rose 7.45% last week, as health-care providers are starting to see increased membership, thanks to the Affordable Care Act. UnitedHealth competitor WellPoint, in particular, increased its full-year guidance this past week and expects more than 1 million new health plan members this year. More members mean higher revenue and bigger earnings. 

Last week's big losers
A week after being the Dow's best performer, McDonald's (MCD 1.20%) wrapped up this week as the second worst stock on the index, with a 2.16% drop. The big news this week was that Chief Operating Officer Tim Fenton, a 41-year company veteran, will step down in October and won't be replaced. His responsibilities will fall to two other senior executives instead. McDonald's has been struggling with improving sales figures and rolling out new menu items over the past year, both areas that would seem to fall to a COO to deal with. Eliminating that position doesn't seem to be the best way for the company to fix its problems.  

Despite the lack of major news, Merck (MRK 1.74%) lost 1.86%, making it the third worst Dow component of the week. Merck is still the best Dow performer this year, up 9.21% versus a 1.65% loss for the index, but the company has lost patent protection on some of its blockbuster drugs over the past few years. Investors need to watch the company's pipeline and determine how long they're willing to wait for the next game-changer to emerge.

Finally, after losing 3.97%, Nike (NKE 0.17%) ended the week as the Dow's worst performer. The stock lost 5.12% on Friday, following its earnings report after Thursday's closing bell. The company beat on both the top and bottom lines, but it warned investors that future growth may not impress. Nike's CFO said growth rates for fiscal 2015 were likely to fall within a mid-teens range, lower than previous forecasts, in part because of a tough currency environment and increased marketing costs. The stock, which had been trading at a high multiple, got pounded when investors heard the news.  

The other Dow losers this week:

  • Boeing, down 0.43%
  • Procter & Gamble, down 1.39%

Matt Thalman owns shares of and Procter & Gamble. The Motley Fool recommends, Netflix, McDonald's, Nike, Procter & Gamble, and UnitedHealth Group and owns shares of, Netflix, McDonald's, and Nike. We Fools don't 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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