Why the Dow's Having a Flat Friday


The stock market is getting pulled in two different directions. On one hand, earnings have generally been a nice surprise, with Amazon.com adding to the positive momentum with a 14% jump after announcing strong results from digital sales stemming from its Kindle Fire release. But on the economic front, U.S. GDP came in weaker than expected, and a downgrade of Spanish debt served as a reminder that bond-market problems in Europe could be around for quite a while. At around 10:45 a.m. EDT, the Dow Jones Industrials (INDEX: ^DJI) were up just 19 points to 13,223, while the S&P 500 (INDEX: ^GSPC) was nearly unchanged.

Among Dow Stocks, Procter & Gamble (NYS: PG) fell more than 3% after a disappointing report. The company beat earnings estimates, but net income dropped from last year's levels. More troubling was P&G cutting its full-year forecast for earnings, citing Venezuelan-mandated price cuts that have eaten into profits. As costs continue to rise for some of its raw materials, P&G will face margin pressure that could adversely affect the company's results well into the future.

Meanwhile, economically sensitive stocks were mixed. Alcoa (NYS: AA) dropped 0.7% in response to the weak GDP figures, despite some favorable trends that it should benefit from in the aerospace industry. Boeing (NYS: BA) , on the other hand, was up slightly on news that it could get a significant order from Philippine Airlines. Even if the overall global economy slows, you can expect certain key industries to keep going strong -- especially if the huge demand for new aircraft and the materials needed to make them continues.

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At the time thisarticle was published Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. You can follow him on Twitter here. The Motley Fool owns shares of Amazon.com. Motley Fool newsletter services have recommended buying shares of Procter & Gamble and Amazon.com. 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 Fool has a disclosure policy.

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