Why Is the Dow So Quiet Today?


The Dow Jones Industrial Average is eerily quiet today. The index is down a minuscule 0.12% as of 1:45 p.m. EST, with 18 stocks trading down and the other 12 going up. Few stocks are going anywhere fast: Only two winners and two losers moved more than 1%.

And there's really no narrative to tie it all together -- no progress on the fiscal cliff, no market-moving data on the U.S. economy. Days like these underscore the individual nature of stocks, even the 30 blue-chips that make up the Dow. What moves one paper might leave another untouched, and rarely does one event move the entire market at once.

Performance leader Alcoa jumped 1.4%, following the lead of peers in the basic-materials sector. Strong manufacturing reports from China and Europe boosted the sector but failed to spark a general stock-market cornucopia.

The other big winner is networking giant Cisco Systems , up 0.8% on another round of sectorwide good news. Cisco had no particular company-specific reason to rise, but ailing rival Alcatel-Lucent was just thrown a lifeline in the form of a $2.1 billion loan. If megabanks Goldman Sachs and Credit Suisse see a telecom spending turnaround coming in time to save Alcatel's bacon and make it repay its new debt, there's fresh hope for the struggling industry as a whole.

But again, the positive effects didn't leak far outside the networking equipment market. Tech giant Microsoft is among the modest losers today, and IBM is up just 0.3%. So hold the party hats and streamers for the tech sector.

American Express snagged the "biggest loser" title with a 1.4% plunge. There's nothing too specific to report, but credit card issuers are down in general. Funny how the consumer-spending barometers can fall even as economic indicators lift infrastructure plays like Alcoa.

The Dow doesn't always tell a coherent story. Invest accordingly.

Materials industries are traditionally known for their high barriers to entry, and the aluminum industry is no exception. Representing 14.7% of 2011 global production in this highly consolidated industry, Alcoa is in prime position to take advantage of growth that some expect will lead to total industry revenue approaching $160 billion by 2017. Based on this prospective and several other company-specific factors, Alcoa is certainly worth a closer look. For a Foolish investment perspective on this global giant, simply click here to get started.

The article Why Is the Dow So Quiet Today? originally appeared on Fool.com.

Fool contributor Anders Bylund has no positions in the stocks mentioned above. Check out Anders' bio and holdings or follow him on Twitter and Google+.The Motley Fool owns shares of International Business Machines and Microsoft. Motley Fool newsletter services recommend American Express Company, Cisco Systems, Goldman Sachs Group, International Business Machines, and Microsoft. 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.

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