The Stocks that Caused the Dow to Close Flat

It was a good way to end a wild week. After the Dow Jones Industrial Average (INDEX: ^DJI) lost more than 400 points in the two previous days, the index closed up four points today. The Dow now sits at 12,815, up just 4.07 points, or 0.03%, for the day. Today's poor market showing can be directly related to political officials. The Dow was up nearly 80 points at one point. But speeches from both political parties stating that they will not bend on their beliefs pertaining to taxing higher income earners, confirmed worries that government officials may not be able to agree on a solution prior to the fiscal cliff deadline.

At the middle of the trading session, four the Dow's 30 components were in the red, three of which were McDonald's (NYS: MCD) , Disney (NYS: DIS) , and Wal-Mart (NYS: WMT) . Find out why they were moving lower by clicking here, or stick around to learn why UnitedHealth Group (NYS: UNH) , Hewlett-Packard (NYS: HPQ) , and United Technologies (NYS: UTX) also were in the red today.

So why are they down?
UnitedHealth Group saw its shares loss 1.01% today. The company has been one of the big losers now that the election is over and Obama and his health care plan are here to stay.  While the Affordable Care Act will help health insurance companies add healthy customers who don't cost insurers very much money, it will also require the companies to add individuals who will cost the companies a large amount of money. People who have pre-existing conditions can no longer be dropped by the insurance companies, and while I'm not saying that's a bad thing, it will likely cost the insurer more money than that customer paid into the system.


Hewlett-Packard -- a staple on the Dow's daily falling stocks -- was down again today by 1.52%. Forbes published a report today which showed that the PC company is analysts' 29th favorite stock in the Dow. Note -- but the Dow only consists of 30 stocks. Additionally, Hewlett-Packard ranks 492 in the S&P 500. Note - the S&P 500 only consists of 500 stocks. The report shows that brokers no longer favor the stock, and are not pushing it on clients. Once a stock falls out of favor with Wall Street, it can be a long time until it regains the market's confidence.

Lastly, United Technologies fell today by 0.42%. With the fiscal cliff quickly approaching, higher taxes are not the only concern for investors. If the Federal Government's budget deficient is also not agreed upon by the end of the year, major automatic government spending cuts will be enacted. Many investors believe United Technologies will be affected by these cuts because of its relationship with the aerospace industry.

Foolishly investing

If you're looking for some long-term investing ideas, let me invite you to read the Fool's brand-new special report, The 3 Dow Stocks Dividend Investors Need. It's absolutely free, so just click here and get your copy today.

  

The article The Stocks that Caused the Dow to Close Flat originally appeared on Fool.com.

Matt Thalman has no positions in the stocks mentioned above. The Motley Fool owns shares of Walt Disney, McDonald's, and UnitedHealth Group. Motley Fool newsletter services recommend Walt Disney, McDonald's, and UnitedHealth Group. 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.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.


Increase your money and finance knowledge from home

Investing in Startups

The lucrative and risky world of startups.

View Course »

Understanding Stock Market Indexes

What does it mean when people say "the market is up 2%"?

View Course »

Add a Comment

*0 / 3000 Character Maximum

1 Comment

Filter by:
wmalezchuk

very interesting material

November 11 2012 at 10:33 PM Report abuse rate up rate down Reply