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Big, old companies drive the Dow’s outperformance

Intel CEO Brian Krzanich. His company was the best Dow performer in October.

Updated with Oct. 31 results.

October was a breakout month for the Dow Jones Industrial Average, as some big, old companies reported earnings results that sent their shares soaring.

The performance of the 30-component index DJIA, +0.13% rose at more than twice the pace as it did in September, 4.3% versus 2.1% (with dividends reinvested). It was the biggest jump since February.

Here’s how the Dow and the other two indices have performed during each of the past 12 months:

Month Dow Jones Industrial Average S&P 500 Nasdaq Composite
October 2017 4.3% 2.3% 3.6%
September 2017 2.1% 2.1% 1.1%
August 2017 0.3% 0.3% 1.4%
July 2017 2.5% 2.1% 3.4%
June 2017 1.6% 0.6% -0.9%
May 2017 0.3% 1.4% 2.7%
April 2017 1.3% 1.0% 2.4%
March 2017 -0.7% 0.1% 1.6%
February 2017 4.8% 4.0% 3.9%
January 2017 0.5% 1.9% 4.4%
December 2016 3.3% 2.0% 1.2%
November 2016 5.4% 3.7% 2.8%
12 months, through Oct. 31, 2017 28.9% 23.6% 31.1%
Source FactSet

So the Nasdaq is your 12-month winner. This, of course, reflects the strength of the technology sector. For the smaller Nasdaq companies, the prospect of lower corporate income tax rates has been a contributing factor, as their businesses tend to be domestically focused, making their income tax scenarios simpler and more costly.

Interestingly, the S&P 500 has recorded no negative monthly returns.

The Dow’s October winners and losers

Here’s how the 30 components of the Dow Jones Industrial Average have performed during October:

Company Ticker Total return - October Total return - 2017 through Oct. 31 Total return- 12 months Total return - 3 years Total return - 5 years
Intel Corp. INTC, +1.52% 19% 28% 34% 46% 148%
Wal-Mart Stores Inc. WMT, +0.90% 12% 29% 28% 24% 33%
Microsoft Corp. MSFT, +0.00% 12% 36% 42% 91% 234%
3M Co. MMM, -0.14% 10% 31% 43% 62% 197%
Caterpillar Inc. CAT, +0.30% 10% 51% 68% 49% 88%
Travelers Co. TRV, +0.42% 8% 10% 25% 41% 110%
UnitedHealth Group Inc. UNH, -0.49% 7% 33% 51% 132% 307%
Johnson & Johnson JNJ, +0.59% 7% 23% 23% 41% 127%
McDonald’s Corp. MCD, -0.07% 7% 40% 52% 95% 125%
International Business Machines Corp. IBM, -0.03% 6% -5% 4% 4% -8%
Nike Inc. NKE, +0.02% 6% 9% 11% 23% 156%
American Express Co. AXP, +0.14% 6% 31% 46% 11% 83%
J.P. Morgan Chase & Go. JPM, +0.41% 6% 19% 49% 80% 176%
Visa Inc. Class A V, +0.62% 5% 42% 34% 86% 229%
DowDuPont Inc. DWDP, +0.59% 4% 29% 38% 62% 192%
United Technologies Corp. UTX, +0.53% 3% 11% 20% 20% 72%
Cisco Systems Inc. CSCO, +1.07% 2% 17% 15% 54% 134%
Goldman Sachs Group Inc. GS, +0.70% 2% 2% 38% 33% 112%
Coca-Cola Co. KO, -0.25% 2% 14% 12% 21% 44%
Exxon Mobil Co. XOM, +0.31% 2% -5% 4% -4% 7%
Boeing Co. BA, -0.37% 1% 69% 87% 125% 317%
Home Depot Inc. HD, -0.30% 1% 26% 39% 81% 200%
Walt Disney Corp. DIS, +1.34% -1% -5% 7% 12% 114%
Chevron Corp. CVX, -0.16% -1% 1% 15% 10% 28%
Pfizer Inc. PFE, +1.40% -2% 11% 15% 30% 68%
Verizon Communications Inc. VZ, -0.30% -2% -6% 4% 10% 35%
Procter & Gamble Co. PG, +0.57% -4% 6% 3% 9% 46%
Merck & Co. US:MR -14% -4% -3% 4% 42%
General Electric Co. GE, -0.43% -17% -35% -28% -14% 13%
Dow Jones Industrial Average DJIA, +0.13% 4% 18% 29% 45% 102%
Source: FactSet

The last double-digit October gainer in the Dow was Caterpillar Inc. CAT, +0.30% which showed it was in the upward swing of its business cycle. Its shares returned 10%.

Seven Dow stocks produced negative returns in October. General Electric Co. GE, -0.43% was the worst, with a 17% decline. Investors expect a major dividend cut, and new CEO John Flannery has his work cut out for him, reining in the company’s expenses. Here’s why GE might be removed from the Dow Jones Industrial Average.

More recent coverage of GE:


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