Dogs of the Dow Dragging Down Markets
Despite falling revenue, pharmaceuticals company Pfizer (NYSE:PFE) got a profit boost in its second quarter, but you wouldn’t know it from looking at its share price today. Pfizer stock, like so many others in the healthcare sector, is trading way down today on the expectation that the deficit-reduction measure just approved by Congress and the president will cut Medicare and Medicaid spending, a blow felt by almost every aspect of the industry. Pfizer shares are down 3.10% today.
Investing Insights: Steve Jobs Prepares to Deliver a New Catalyst for Apple’s Stock.
Boeing (NYSE:BA) shares are taking a beating with the now 10-day partial FAA shutdown. Congress has yet to agree upon a short-term appropriations budget for the Federal Aviation Administration, the deadline for which is now 10 days in the past, and without funding, the FAA has had to halt everything from airport construction projects to tax collection on air fares, and has had to put 4,000 federal employees on furlough. It’s also disrupted Boeing getting FAA certification of its new 747-8 model jumbo jet that would allow it to be used in airports nationwide. Boeing shares are down 2.59% so far today.
United Technologies Corp. (NYSE:UTX) is taking a hit from the debt deal, which will be cutting a significant amount of defense spending. While the company works in a lot of different technology and services fields, in 2010, its military aerospace sales were responsible for 21% of the company’s net sales. With the Pentagon being forced to cut spending, companies with defense-contracts like UTX are looking at a significant drop off in sales. UTX shares are down 3.10% today.
General Electric (NYSE:GE) and The Home Depot (NYSE:HD) are both helping to drag down the Dow today after the Commerce Department reported a decline in consumer spending in July for the first month since September 2009. If the trend continues, General Electric will likely witness decreasing sales for its home appliances while Home Depot, which sells building materials, home improvement and lawn and garden products, would also take a hit as consumers tighten their belts and begin saving some of their expendable income rather than spending it. GE shares are down 3.56% today and HD shares are down 2.86%.