Prepare Your Portfolio with These Rock-Solid Dividend Payers
Successful investing is a bit like connecting the dots. Put enough of them together and they begin to form a picture.
Unfortunately, today’s dots are pointing towards a recession.
With first-quarter GDP growth under 2% and a whole host of indicators moving in the wrong direction, it looks as though the U.S. economy has stalled.
That leaves income investors like us faced with a very important question: how do we best protect our portfolios from the stock price declines and dividend cuts that a recession would bring?
One simple answer is to invest in those countries that are not suffering recession. That opens up a world of possibilities.
For instance, you might consider investing in Japan, which grew at over 4% in the first quarter. Orix Corporation (NYSE: IX) is a name I like.
Or better yet you could invest in emerging markets where growth continues to sizzle.
That makes stocks like the Aberdeen Chile Fund (NYSE: CH) a good buy-especially considering the fund offers a dividend yield over 10%. The fund is attractive to me for two reasons.
First, it’s because Chile is a well-run country, standing higher than the U.S. on several international business surveys. But more importantly, its dependence on copper and other commodities is not a problem unless the global economy as a whole goes into recession, which I don’t expect.
With assets in primarily Chilean securities, the fund also offers investors a nice measure of diversification from the U.S. economy, since they can expect Chile to keep on growing– even if the U.S. economy takes a step backwards.
But that doesn’t mean you need to avoid the U.S. altogether, either.
In fact, there is a key indicator I’ll discuss in a moment which will allow you to preserve your income and the value of your investments through all but the deepest recessions.
First though, you’ll need to avoid a few pitfalls. As always, it’s never just a matter of picking the stocks with the highest dividend yield. It’s just not that simple.
In fact, a number of the highest dividend-paying companies like American Capital Agency (Nasdaq: AGNC) have dividends that depend on financial game-playing— borrowing in the short-term markets and investing in long-term housing agency debt.
While the income stream from the agency bonds will remain solid in a recession (because it is effectively government guaranteed) entrusting much of one’s wealth to this kind of scheme is foolish.
Meanwhile, other high-paying dividend companies have overleveraged balance sheets.
B&G Foods (NYSE: BGS), for example, has an excellent recession-proof business in managing brands of shelf-stable foods such as Cream of Wheat and Grandma’s Molasses – products whose sales generally suffer little in a recession. At its current elevated share price of around $26 it still has a dividend yield of around 4%.
However, its balance sheet has a 4:1 debt/equity ratio, and excluding intangible assets it has a negative net worth.
BGS also suffered badly in 2008-09, with the share price dropping below $3. This could easily happen again if bank facilities became tight.
The True Sign of Recession-Proof Stocks
However, at the other end of the spectrum, there are some dividend aristocrats which have not only maintained but increased their dividends for over half a century.
Having survived every recession since 1962, they can be expected to survive the next one, and indeed to continue increasing their dividend.
For investors, that’s the true sign of a recession-proof stock.
As a result, these types of stocks represent the ultimate safe haven for your money. Their share price and even earnings may decline, but their dividends should continue to increase.
There are 10 such companies, four of which have a current dividend yield of 3.5% or more – giving you a pretty good yield at a time when even 30-year Treasury bonds yield only 2.7%.
- Procter and Gamble Co. (NYSE: PG) has increased dividends every year since 1954. This huge household goods company pays a dividend yield of 3.7%;
- Northwest Natural Gas (NYSE: NWN) has increased dividends every year since 1956. With a dividend yield of 3.7%, the company stores and distributes natural gas in Oregon, Washington and California;
- Emerson Electric (NYSE: EMR) has increased dividends every year since 1957. This worldwide engineering services and solutions company pays a dividend yield of 3.5%;
- Cincinnati Financial Corp. (Nasdaq: CINF) has increased dividends every year since 1961. The property and casualty insurance company pays a dividend yield of 4.2%.
Here’s the best part: with those four you even get the diversification of four different sectors along with the ultimate dividend-producing, sleep-at-night investments.
So you see sometimes, investing can be easy—even in the face of a recession.
By Martin Hutchinson, Global Investing Strategist, Money Morning
Nothing like foreign exchange trading which provides 24 hours of moneymaking opportunity. Forex currency trading is one of the fastest growing industries in the world. Under this system, 24 million dollars of business is done every second.
From anywhere in the world, working with just a computer and no one to boss you around, no office, and no big capital, online forex trading furnishes endless work from home 24 hours a day.
Forex trading is a $2.5 trillion a day industry. Any other market like stock trading has much less volume, restricted hours of business and numerous factors to deal with.
In forex trading, you can concentrate on 4 major currency pairs. Though there are risks associated with forex trading, if learned properly, there is potential for big profits
We had seen mini accounts, but now we have even super mini accounts or Micro Accounts, With this, one can start forex trading with as little as $25 with little risk and within five minutes of registering with an online forex trading company.
No other type of online trading offers such a huge potential. Take stock market alone, one will need thousands of dollars to start trading.
Leverage factor in currency exchange trading is very huge. With just $1,000, you can have the capacity of doing hundred times more business, i.e. $100,000. Using a $1000 to buy a forex contract worth $100,000 is leveraging. In this case only $1000 is at risk, but there a big potential for gains.
The beauty of forex trading is that here one can operate in all major markets of the world. With different time zones, one can virtually do trading in 24 hours a day. Forex market never sleeps.
One important strategy of profiting from forex market is to follow technical analysis and of course, the News, Technical analysis alone predicts peaks and troughs. If one can catch a trend, this may bring in substantial profits to any forex player.
There are numerous online brokers. While selecting one, main factors to be kept under consideration are the ease of doing trading, online tutorials, instructional material, easy transfer of funds, facility of trading in major markets and currencies, expert advice, low transaction fees, flexible accounts, availability of mini accounts etc.
One has to be careful in selecting an online forex broker. He should take care of novice and professional traders alike. A new forex trader should be able to find the ease of trading and timely guidance.
One main benefit of forex trading is that it is simple to follow unlike stock trading where one has to study thousands of stocks. It is the most liquid market in the world, This means that a trader can enter or exit the market at will in almost any market condition with minimal execution risk.
With currency trading, one can trade and exchange millions of dollars in seconds.
If you are seriously interested in any online home based business, then you must consider Forex-Trading option. Many forex trading platforms offer mock trading. You can do free live mock trading and test your skills. Once you feel comfortable, you can start real trading.
There is no cost associated in joining any online forex trading and testing their Platform. This can be a highly profitable Internet business.
Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Forex Traders should be aware that forex trading involves substantial risk of loss and is not suitable for all investors. Investors should only invest risk capital which they can afford to lose without dramatically impacting their lifestyle.
By: Adma Dababneh
Saudi Arabia And China Team Up To Build A Gigantic New Oil Refinery – Is This The Beginning Of The End For The Petrodollar?
The largest oil exporter in the Middle East has teamed up with the second largest consumer of oil in the world (China) to build a gigantic new oil refinery and the mainstream media in the United States has barely even noticed it. This mammoth new refinery is scheduled to be fully operational in the Red Sea port city of Yanbu by 2014. Over the past several years, China has sought to aggressively expand trade with Saudi Arabia, and China now actually imports more oil from Saudi Arabia than the United States does. In February, China imported 1.39 millionbarrels of oil per day from Saudi Arabia. That was 39 percent higher than last February. So why is this important? Well, back in 1973 the United States and Saudi Arabia agreed that all oil sold by Saudi Arabia would be denominated in U.S. dollars. This petrodollar system was adopted by almost the entire world and it has had great benefits for the U.S. economy. But if China becomes Saudi Arabia’s most important trading partner, then why should Saudi Arabia continue to only sell oil in U.S. dollars? And if the petrodollar system collapses, what is that going to mean for the U.S. economy?
Those are very important questions, and they will be addressed later on in this article. First of all, let’s take a closer look at the agreement reached between Saudi Arabia and China recently.
The following is how the deal was described in a recent China Daily article….
In what Riyadh calls “the largest expansion by any oil company in the world”, Sinopec’s deal on Saturday with Saudi oil giant Aramco will allow a major oil refinery to become operational in the Red Sea port of Yanbu by 2014.
The $8.5 billion joint venture, which covers an area of about 5.2 million square meters, is already under construction. It will process 400,000 barrels of heavy crude oil per day. Aramco will hold a 62.5 percent stake in the plant while Sinopec will own the remaining 37.5 percent.
At a time when the U.S. is actually losing refining capacity, this is a stunning development.
Yet the U.S. press has been largely silent about this.
But China is not just doing deals with Saudi Arabia. China has also been striking deals with several other important oil producing nations. The following comes from a recent article by Gregg Laskoski….
China’s investment in oil infrastructure and refining capacity is unparalleled. And more importantly, it executes a consistent strategy of developing world-class refining facilities in partnership with OPEC suppliers. Such relationships mean economic leverage that could soon subordinate U.S. relations with the same countries.
Egypt is building its largest refinery ever with investment from China.
Shortly after the partnership with Egypt was announced, China signed a $23 billion agreement with Nigeria to construct three gasoline refineries and a fuel complex in Nigeria.
Essentially, China is running circles around the United States when it comes to locking up strategic oil supplies worldwide.
And all of these developments could have tremendous implications for the future of the petrodollar system.
If you are not familiar with the petrodollar system, it really is not that complicated. Basically, almost all of the oil in the world is traded in U.S. dollars. The origin of the petrodollar system was detailed in a recent article by Jerry Robinson….
In 1973, a deal was struck between Saudi Arabia and the United States in which every barrel of oil purchased from the Saudis would be denominated in U.S. dollars. Under this new arrangement, any country that sought to purchase oil from Saudi Arabia would be required to first exchange their own national currency for U.S. dollars. In exchange for Saudi Arabia’s willingness to denominate their oil sales exclusively in U.S. dollars, the United States offered weapons and protection of their oil fields from neighboring nations, including Israel.
By 1975, all of the OPEC nations had agreed to price their own oil supplies exclusively in U.S. dollars in exchange for weapons and military protection.
This petrodollar system, or more simply known as an “oil for dollars” system, created an immediate artificial demand for U.S. dollars around the globe. And of course, as global oil demand increased, so did the demand for U.S. dollars.
Once you understand the petrodollar system, it becomes much easier to understand why our politicians treat Saudi leaders with kid gloves. The U.S. government does not want to see anything happen that would jeopardize the status quo.
A recent article by Marin Katusa described some more of the benefits that the petrodollar system has had for the U.S. economy….
The “petrodollar” system was a brilliant political and economic move. It forced the world’s oil money to flow through the US Federal Reserve, creating ever-growing international demand for both US dollars and US debt, while essentially letting the US pretty much own the world’s oil for free, since oil’s value is denominated in a currency that America controls and prints. The petrodollar system spread beyond oil: the majority of international trade is done in US dollars. That means that from Russia to China, Brazil to South Korea, every country aims to maximize the US-dollar surplus garnered from its export trade to buy oil.
The US has reaped many rewards. As oil usage increased in the 1980s, demand for the US dollar rose with it, lifting the US economy to new heights. But even without economic success at home the US dollar would have soared, because the petrodollar system created consistent international demand for US dollars, which in turn gained in value. A strong US dollar allowed Americans to buy imported goods at a massive discount – the petrodollar system essentially creating a subsidy for US consumers at the expense of the rest of the world. Here, finally, the US hit on a downside: The availability of cheap imports hit the US manufacturing industry hard, and the disappearance of manufacturing jobs remains one of the biggest challenges in resurrecting the US economy today.
So what happens if the petrodollar system collapses?
Well, for one thing the value of the U.S. dollar would plummet big time.
U.S. consumers would suddenly find that all of those “cheap imported goods” would rise in price dramatically as would the price of gasoline.
If you think the price of gas is high now, you just wait until the petrodollar system collapses.
In addition, there would be much less of a demand for U.S. government debt since countries would not have so many excess U.S. dollars lying around.
So needless to say, the U.S. government really needs the petrodollar system to continue.
But in the end, it is Saudi Arabia that is holding the cards.
If Saudi Arabia chooses to sell oil in a currency other than the U.S. dollar, most of the rest of the oil producing countries in the Middle East would surely do the same rather quickly.
And we have already seen countries in other parts of the world start to move away from using the U.S. dollar in global trade.
For example, Russia and China have agreed to now use their own national currencies when trading with each other rather than the U.S. dollar.
That got virtually no attention in the U.S. media, but it really was a big deal when it was announced.
A recent article by Graham Summers summarized some of the other moves away from the U.S. dollar in international trade that we have seen recently….
Indeed, officials from China, India, Brazil, Russia, and South Africa (the latest addition to the BRIC acronym, now to be called BRICS) recently met in southern China to discuss expanding the use of their own currencies in foreign trade (yet another move away from the US Dollar).
- China and Russia have removed the US Dollar from their trade
- China is rushing its trade agreement with Brazil
- China, Russia, Brazil, India, and now South Africa are moving to trade more in their own currencies (not the US Dollar)
- Saudi Arabia is moving to formalize trade with China and Russia
- Singapore is moving to trade yuan
The trend here is obvious. The US Dollar’s reign as the world’s reserve currency is ending. The process will take time to unfold. But the Dollar will be finished as reserve currency within the next five years.
Yes, the days of the U.S. dollar being the primary reserve currency of the world are definitely numbered.
It will not happen overnight, but as the U.S. economy continues to get weaker it is inevitable that the rest of the world will continue to question why the U.S. dollar should automatically have such a dominant position in international trade.
Over the next few years, keep a close eye on Saudi Arabia.
When Saudi Arabia announces a move away from the petrodollar system, that will be a major trigger event for the global financial system and it will be a really, really bad sign for the U.S. economy.
The level of prosperity that we are enjoying today would not be possible without the petrodollar system. Once the petrodollar system collapses, a lot of our underlying economic vulnerabilities will be exposed and it will not be pretty.
Tough times are on the horizon. It is imperative that we all get informed and that we all get prepared.
America absolutely loves Wal-Mart. 100 million customers visit Wal-Mart every single week in this country. But is Wal-Mart good for America? That is a question that most people never stop and ask. Most of us love shopping in big, clean stores that are packed with super cheap merchandise, but the truth is that Wal-Mart is destroying America in a lot of ways. As you will see below, Wal-Mart has destroyed tens of thousands of small businesses and countless manufacturing jobs over the past couple of decades. Wal-Mart has become a gigantic retail behemoth that sells five times more stuff than any other retailer in the United States. Unfortunately, about 85 percent of all the stuff sold at Wal-Mart is made overseas. What that is costing the U.S. economy in terms of lost jobs and lost revenue is incalculable. But Wal-Mart is a perfect example of where our economic system is headed. Our economy is becoming completely and totally dominated by highly centralized monolithic predator corporations that ruthlessly crush all competition and that will stoop to just about anything in order to cut costs. In the future, will we all be working for gigantic communal entities that funnel all of the wealth and economic rewards to a very tiny elite? That sounds very much like how communist China works, and red-blooded Americans should want no part of that. America is supposed to be about free enterprise and competition and working together to build up this country, and Wal-Mart is destroying all of that.
The following are 20 facts about Wal-Mart that will absolutely shock you….
#1 The average U.S. family now spends more than $4000 a year at Wal-Mart.
#2 In 2010, Wal-Mart had revenues of 421 billion dollars. That amount was greater than the GDP of 170 different countries including Norway, Venezuela and the United Arab Emirates.
#3 If Wal-Mart was a nation, it would have the 23rd largest GDP in the world.
#4 Wal-Mart now sells more groceries than anyone else in America does. In the United States today, one out of every four grocery dollars is spent at Wal-Mart.
#5 Amazingly, 100 million customers shop at Wal-Mart every single week.
#6 Wal-Mart has opened more than 1,100 “supercenters” since 2005 alone.
#7 Today, Wal-Mart has more than 2 million employees.
#8 If Wal-Mart was an army, it would be the second largest military on the planet behind China.
#9 Wal-Mart is the largest employer in 25 different U.S. states.
#10 According to the Economic Policy Institute, trade between Wal-Mart and China resulted in the loss of 133,000 manufacturing jobs in the United States between 2001 and 2006.
#11 The CEO of Wal-Mart makes more in a single hour than a full-time Wal-Mart associate makes in an entire year.
#12 Tens of thousands of Wal-Mart employees and their children are enrolled in Medicaid and are dependent on the government for healthcare.
#13 Between 2001 and 2007, the value of products that Wal-Mart imported from China grew from $9 billion to $27 billion.
#14 Sadly, about 85 percent of all the products sold at Wal-Mart are made outside of the United States.
#15 It is being reported that about 80 percent of all Wal-Mart suppliers are in China at this point.
#16 Amazingly, 96 percent of all Americans now live within 20 miles of a Wal-Mart.
#17 The number of “independent retailers” in the United States declined by 60,000 between 1992 and 2007.
#18 According to the Center for Responsive Politics, Wal-Mart spent 7.8 million dollars on political lobbying during 2011. That number does not even include campaign contributions.
#19 Today, Wal-Mart has five times the sales of the second largest U.S. retailer (Costco).
#20 The combined net worth of six members of the Walton family is roughly equal to the combined net worth of the poorest 30 percent of all Americans.
All over the country, independent retailers are going out of business because they cannot compete with Wal-Mart and their super cheap Chinese products. Often communities will give Wal-Mart huge tax breaks just to move in to their areas. But what many communities don’t take into account is that the introduction of a Wal-Mart is often absolutely devastating to small businesses….
A study of small and rural towns in Iowa showed lost sales for local businesses ranging from -17.2% in small towns to -61.4% in rural areas, amounting to a total dollar loss of $2.46 BILLION over a 13-year period.
Wal-Mart often tells one thing to the public and then does another thing in private. Sadly, the truth is that Wal-Mart does not care about U.S. manufacturing jobs. Wal-Mart just wants to get products as cheaply as they possibly can, and most of the time that means getting them from China.
Just check out this first-hand testimony from an 81-year-old retired apparel manufacturer….
I was president of the Southwestern Apparel Manufacturers Association. There was a meeting sometime between 1985 and 1990. Walmart had contacted our organization and asked if they could meet with us at our beautiful Apparel Mart we had here in Dallas, which has now been razed, because all the independent merchants don’t exist that used to come to it. Two people from Walmart came down and they said they were going to be sourcing goods from overseas and we would have to meet those prices for consumer products and to get ready for it—we are going to be sourcing the world. Walmart was the only company that came out and said this.
It was sort of shocking: I was selling them some merchandise at the time. On the back of their trucks it was saying “Bring it Back to America!” They had the big “keep it in America” program going at that time on the big signs in the stores. Meanwhile when I reminded the buyer of that, she told me, “that is just for domestic consumption, we’re going to buy at the cheapest we can anywhere on earth.”
We are losing millions of good jobs that cannot be replaced. If you can believe it, the United States has actually lost an average of about 50,000 manufacturing jobs a month since China joined the World Trade Organization in 2001.
Last year, the U.S. trade deficit with China was the biggest trade deficit that one nation has had with another nation in the history of the world, and Wal-Mart played a huge role in that.
In fact, Wal-Mart has actually been forcing some U.S. manufacturers to pack up and move overseas. The following is from a recent article by Amy Traub….
Walmart’s market power is so immense that the even the largest suppliers must comply with its demands for lower and lower prices because they cannot afford to have their goods taken off its shelves. Companies that used to manufacture products in the United States, from Levi’s jeans to lock maker Master Lock, were pressured to shut their U.S. factories and moved manufacturing abroad to meet Walmart’s demand for low prices.
Unfortunately, the vast wealth that Wal-Mart is sucking out of our communities is not put back into our communities. The profits are funneled out to Wal-Mart executives and shareholders. We may enjoy the low prices, but very little of the money that we give to Wal-Mart gets recycled in our local areas.
In the old days, you could actually support a family selling electronics or running a general store. But you can’t support a family working at Wal-Mart. The vast majority of the jobs that Wal-Mart creates are very low paying. Large numbers of Wal-Mart employees are actually on welfare, and this is part of the reason why we have seen such an explosion in the number of the working poor in America.
At this point, more than 40 percent of all jobs in America are low wage jobs and the middle class is rapidly disappearing.
If we do not support American jobs and American manufacturers they will continue to go away and the welfare rolls in this country will continue to explode.
There is not going to be any prosperity in this country without jobs. Unfortunately, most Americans simply do not understand how good jobs are being systematically destroyed in America every single day.
The path that America is headed on today is only going to end in complete and total disaster. We are being transformed from a wealthy nation into a poor nation. In the end, we will be dominated by a very tiny elite and everyone else will either be among the working poor or will be totally dependent on the government.
Our system is supposed to be about open, honest competition. But that is not what Wal-Mart is about. Wal-Mart is about crushing small businesses and manufacturers here in America and getting us all to buy their super cheap Chinese-made goods.
Shame on Wal-Mart. They are an un-American disgrace.
So what do all of you think about Wal-Mart? Please feel free to post a comment with your thoughts below….Original Article-The Economic Collapse
The big economies of Spain, Italy and even France are now looking increasingly shaky.
Spain’s problems are probably the most acute; the cost of borrowing is around seven per cent for Madrid at the moment and that is a psychologically important level as it is the level at which Greece, Ireland and Portugal needed international financial assistance.
But there are some concerns that the $125bn Spanish bank bailout was botched.
The eurozone is not lending the money to the banks directly. Instead, it is being passed through the government, which in effect adds to the nation’s debt problems and makes it more difficult for Spain to borrow money.
JPMorgan believes that Spain’s bailout will push the country’s debt-to-GDP ratio to 108 per cent – up from the current figure of around 70 per cent.
And then there is the risk of contagion and the impact it may have on Italy. Italy does not have the same property and unemployment crises as Spain, but its debts do stand at 120 per cent of its GDP.
On this episode of Counting the Cost, Al Jazeera’s Paul Brennan meets one Spanish family feeling the full force of Spain’s problems.
Then we speak to Ebrahim Rahbari, an economist at Citigroup, which was the first to say that Spain would need a bailout and ask him if he thinks the bailout will really succeed in targeting the banks’ instability.
It’s going to take more than low interest rates to fire up investors.
The Federal Reserve’s latest plan to help the economy failed to impress Wall Street on Wednesday. Stocks finished slightly lower for the day, and not much better than they were before the Fed announcement.
The Fed said it would keep its “Operation Twist” program going through the end of the year rather than let it expire at the end of this month. It aims to keep long-term interest rates low by selling the Fed’s short-term U.S. government debt and buying long-term debt.
Economists have pointed out that long-term interest rates are already near record lows, and that consumers and businesses who aren’t borrowing today won’t necessarily borrow tomorrow just because it’s a little cheaper.
The Fed also sharply lowered its outlook for U.S. economic growth. Chairman Ben Bernanke said the economy would grow no more than 2.4 percent this year, down from an April forecast of no more than 2.9 percent.
“What the markets really don’t like was he ratcheted down growth sharply,” said Doug Cote, chief market strategist at ING Investment Management.
The Dow Jones industrial average closed down 12.94 points, or a tenth of a percent, at 12,824.39. The Standard & Poor’s 500 index fell 2.29 points, or 0.2 percent, to 1,355.69. The Nasdaq composite index rose 0.69 points, a fraction of a percent, to 2,930.45.
Indexes dipped right after the Fed’s announcement came out at 12:30 p.m., then quickly went back to where they were. It was the latest knee-jerk response to news headlines in a stock market that has been buffeted in recent weeks by fears that Europe’s 17-nation currency union could rupture.
“It’s obvious we’re still in a trader’s market, and it’s a market that is still responding to news events, including the Fed, almost hour by hour, if not minute by minute,” said Quincy Krosby, a market strategist with Prudential Financial.
Stocks spent most of the morning lower. Some of the same weakness being addressed by the Fed has forced Procter & Gamble Co. to reign in recent price increases as people cut back on spending. P&G is the world’s largest consumer products company, and sales of its Tide detergent and Duracell batteries, among other things, are a good window into the economy.
P&G predicted continued slow growth in developed markets and slower growth in China, and cut estimates for fourth-quarter revenue and income. The stock dropped $1.83, 2.9 percent, to $60.39, making it the biggest decliner in the Dow Jones industrial average.
Next week, new figures on personal income and consumer sentiment will be released. The reports could signal more retrenchment by the U.S. consumer.
Actuant Corp., which makes industrial products, fell 94 cents, or 3.4 percent to $26.51 after predicting “uneven end market demand, notably in Europe and China.” The company predicted revenue for its current and next fiscal years will be less than analysts had been expecting.
Adobe Systems dropped 90 cents, or 2.7 percent, to $31.99. The software maker, whose products include Adobe Reader and Photoshop, issued a profit forecast late Tuesday that was weaker that analysts were expecting. Its income for the latest quarter fell 2 percent on higher expenses.
La-Z-Boy plunged almost 13 percent after earnings came in far below what analysts were expecting. The stock lost $1.66 to close at $11.47.
Markets in Europe rose and the euro strengthened against the dollar. Benchmark stock indexes rose 0.5 percent in Germany, 0.6 percent in Britain and 2.1 percent in Italy.
Borrowing costs fell in Europe, too. Yields on government bonds in Spain and Italy fell, a signal that investors are less worried about the finances of those two countries.
The yield on the benchmark 10-year Treasury note rose to 1.63 percent from 1.62 percent the day before as investors moved money out of low-risk assets.
Randy Warren, chief investment officer for Warren Financial Service, lamented the focus on the Fed, saying investors should be thinking about where to put their money considering Europe’s problems and a weak euro. He favors American companies who mostly do business in the U.S.
“There’s plenty to choose from for investors,” he said. “They just have to think more than five minutes ahead.”