Home Depot and Housing Bring Down the Dow
Stock markets have recovered from early losses and are now close to breaking even on the day. The Dow Jones Industrial Average is now down just 0.22%, and the S&P 500 has fallen 0.11%.
The pessimism this morning involved concerns in Europe and a 0.4% decline in pending home sales in February. The National Association of Realtors said its pending-home-sales index fell to 104.8, which was still up more than 8% from a year ago. Housing is a big part of the economic recovery, and even one bad reading can put investors in a bad mood.
The housing data has Home Depot down 0.7%, today but the stock is still within striking distance of its 52-week high. What we should really be looking at is the long-term growth in the housing industry instead of the month-to-month gyrations. It's this long-term growth that has sent Home Depot higher and what will drive it in the future as well.
Verizon has also moved sharply lower today, losing 1.3% of its value. The stock is now the fifth-most shorted stock on the Dow, showing that investors are turning more bearish on the company.
On the flip side, UnitedHealth Group is up 1.8% on hope that Medicare payments may rise. Bloomberg is reporting that congressional researchers have the authority to raise payments to insurers if officials assume that a 25% cut in physicians' pay won't go into effect. This could lead payment rates to rise by 4% to 5%, according to the nonpartisan Congressional Research Service. Higher rates means bigger profits -- something all investors want.
When President Obama was re-elected, shares of UnitedHealth and other health insurers fell immediately. Is Obamacare a death knell for health insurers, or is the market missing out on some of the opportunities the law presents? In this brand-new premium report on UnitedHealth, The Motley Fool takes a long-term view, honing in on prospects for UnitedHealth in a post-Obamacare world. So don't miss out -- simply click here now to claim your copy today.
The article Home Depot and Housing Bring Down the Dow originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool recommends Home Depot 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 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.