Quarterly earnings reports continued to be the main catalyst that moved stocks today. Though some strong manufacturing and housing data came across the wire this morning, the thing investors and traders were focused on was how to interpret the various financial reports in order to position themselves for the rest of 2013. By the the close, the major indices settled in negative territory.
Apple’s (AAPL) earnings after the close yesterday drew most of the attention from the media. After posting mostly disappointing earnings over the past three quarters, investors seemed to be pleased the the iPhone and iPad maker’s third quarter earnings. As such, the stock saw some gains in the day’s trading.
Some other stocks that saw gains after optimistic earnings releases were A.O. Smith (AOS), Eli Lilly (LLY), EMC Corp (EMC), Evercore Partners (EVR), Ford (F), General Dynamics (GD), Moody’s (MCO), Northrop Grumman (NOC), and Tupperware (TUP).
On the other hand, companies like Caterpillar (CAT), Broadcom Corp (BRCM), AT&T (T), Norfolk Southern (NSC), Seagate Technologies (STX), The Nasdaq OMX Group (NDAQ), and Dr Pepper Snapple (DPS) have disappointed investors with underwhelming earnings, which caused their shares to take a hit today.
Be sure to check the Dividend Daily for all the latest earnings reports, analyst moves, and much more.A Closer Look at Caterpillar
“World economic growth slowed in the first half of the year, and we are revising our growth estimates downwards. Although we expect some improvement in the second half, the improvement will be less than previously expected. Currently, we expect that world economic growth for 2013 will be a little over 2 percent, slightly slower than in 2012.”
Essentially the company is saying that they are cutting their earnings outlook because of an industrial and manufacturing slowdown across the world. This commentary reinforces a view that many investors, analysts, and economists already have: global economic growth is stagnating and/or slowing. For investors, this slowdown should be a development to pay attention to; in this day in age of globalization, any global economic slowdown can and probably will impact domestic investments and the overall domestic economy.Always Be Prepared
Often American investors get so caught up with what is going on domestically, whether it is on Wall Street or in Washington, that we tend to pay a little less attention to the health of the global economy. But the troubling economic situations in Europe, a number of emerging markets, and especially China should be a cause for concern. While there is nothing that we as individual investors can do to change this economic development, we can position our holdings to limit ourselves to global exposure in the event the global economic situation takes a turn for the worst.
I’m not here trying to warn you about a doom and gloom scenario. All I am doing is just laying out the economic realty facing investors today. While many companies or countries may be able to navigate the potential global economic obstacles and come out looking good, I want to ensure that our readers are prepared for any situation that may come our way.
Thanks for reading everybody. We’ll see you tomorrow!
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