McDonald's Rallies, but DuPont Leads the Dow Into the Red

Updated

Markets have turned down n the afternoon session, with the Dow Jones Industrial Average losing all of its earlier gains to drop about 45 points into the read as of 2:30 p.m. EDT. However, blue-chip investors have made the most of the day with around half the index's member stocks still in the green so far. McDonald's has bounced back 3.4% today to lead the Dow after expressing optimism about its future. Meanwhile, DuPont has fallen to the bottom of the Dow in dropping 1.8%. Let's catch up on what you need to know from around the markets.

Can McDonald's turn it around?
McDonald's CFO Pete Bensen lifted shareholders' spirits today by saying that the fast-food giant could look at new cost-cutting and borrowing measures in an attempt to return cash to stockholders and buoy a stock that has slumped by more than 3% over the past year. Bensen also noted a renewed focus on service and other basics in order to boost McDonald's performance as rivals look to chip away at the company's industry leadership.

Bensen's optimism is inspiring, but wary shareholders need to see real performance from a company that's weathered declining results in major markets as of late. Global sales at stores open at least 13 months fell 0.3% in February, marking the fourth straight monthly decline and falling further than analysts expected. Sales fell a larger 1.4% for the month at U.S. restaurants. While McDonald's quickly pointed out the impact of unseasonably bad winter weather on results, the fall hasn't been concentrated in America. The firm's sales in the Middle East, Africa, and Asia dipped 2.6% for the month, and McDonald's faces losing ground against hard-charging rivals in the race to capture emerging market share.


Like McDonald's, winter weather is at the forefront of DuPont's challenges. DuPont today warned that the frozen winter, along, with Ukraine's territorial standoff with Russia, could hurt its results in the first quarter. The company is bullish on its full-year performance in 2014, though, as DuPont's burgeoning agricultural business picks up steam. However, the company has a major seed production facility in Ukraine. The political flux in the Eastern European country has hit seed deliveries; while that shouldn't worry investor perspectives on DuPont's long-term power in a standout agricultural market, it could lead to disappointment in the next quarterly earnings report.

Outside of the Dow, embattled retailer J.C. Penney has captured investor attention today as the stock has jumped 3.8%. Penney has dominated headlines over the past year for its downturn -- the stock has fallen more than 77% over the past two years as the retail market has run into tough challenges -- but the company's stock has rallied 40% over the past month. Today Citigroup upgraded the stock to buy from neutral, citing same-store sales growth in the fourth quarter and restocking as drivers for the future. Still, don't let the recent upswing lull your investing strategy into a false sense of security: J.C. Penney has posted full-year losses in three straight years, and it will take more than a quarter or two to turn around this retailer, particularly as American consumer confidence continues to fluctuate with the economy's comeback.

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The article McDonald's Rallies, but DuPont Leads the Dow Into the Red originally appeared on Fool.com.

Dan Carroll has no position in any stocks mentioned. The Motley Fool recommends McDonald's. The Motley Fool owns shares of Citigroup and McDonald's. 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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