Last Wednesday we hosted a press event in New York, where I spoke on a panel with a colleague from SAM, the firm that evaluates companies for inclusion in our Dow Jones Sustainability Indexes. The topic was corporate sustainability and sustainability indexes, with a specific emphasis on answering the following question: How can investors discern which companies are committed to a sustainability philosophy? Here’s a look at a few of the key themes that arose from the discussions: Corporate interest in sustainability initiatives is on the rise. Each year, SAM invites the largest 2,500 companies worldwide to participate in its annual Corporate...
Read MoreIBM announced today that it is raising its dividend by 13 percent, from 75 cents a share to 85 cents a share. The news wasn’t exactly earth-shattering, considering this is the 17th straight year that IBM has increased its dividend, and its ninth year in a row of double-digit percent increases. But surprising or not, the news will be welcomed by the throngs of dividend-hungry investors who have been piling into dividend-focused funds this year. As observed earlier this month by Wall Street Journal columnist Jason Zweig, mutual funds and ETFs focused on U.S. stocks that pay stable, high or rising...
Read MoreA few weeks back, we featured a blog post on the ABCs of Index Methodologies. Today, we’re going to take a deeper dive into one key aspect of index design: the mechanisms we use to manage index turnover. By “turnover,” I mean the rate at which we add, delete and otherwise change out the stocks (or bonds, commodity futures, etc.) that make up an index. For example, take the Dow Jones Global Titans 50 Index. In a typical year, three of the index’s 50 component stocks might be replaced. If these three stocks together accounted for 6% of the index’s market...
Read MoreYou probably heard about the 6th Annual Summit of the Americas that took place over the weekend, but for all the wrong reasons. The salacious headlines about the Secret Service may make the 2012 summit one of the most remembered in history. But the meeting of the member states of the Organization of American States (OAS) is quite newsworthy in its own right. Held once every three years, the summit intends to help “define a hemispheric agenda at the highest level to address urgent challenges and propel positive change.” The theme of this year’s gathering, “Connecting the Americas: Partners in Prosperity,”...
Read MoreThe Dow has taken quite a hit this week: Over the past five trading sessions it has dropped 548.56 points, or 4.14%. The slide is The Dow’s longest stretch in the red since August 2, 2011, and follows a run-up that added 994.48 points between January 1 and March 30 (which, incidentally, was The Dow’s best first quarter in its history). Most experts are pointing to the jobs report released on Good Friday as the trigger for this change in fortunes. The report showed that only about 120,000 jobs were created in March, about half the number in each of the...
Read MoreBefore you bite the ears off that chocolate bunny, here’s some food for thought: The price of cocoa could be going up. After all, researchers from the University of California-San Diego published study results last week revealing that people who eat lots of chocolate (and exercise) may be thinner than those who do not. That soundbite alone may have sent millions of Americans running to their favorite chocolatier. But the more important news about cocoa is coming from other parts of the world. It’s become common knowledge that rapidly growing emerging markets are fueling demand for hitherto developed-world favorites such as designer...
Read MoreOn Friday, we reported that the Dow Jones Industrial Average had climbed 994.48 points during the first three months of 2012, for its best-ever first-quarter point gain. Like many, we couldn’t resist taking another opportunity to consider how far the index had come since its nadir during the recession, and how close it was getting to reclaiming its all-time high of 14164.53, which it hit on October 9, 2007. Of course, conventional wisdom tells us we shouldn’t get too caught up in index milestones like these. After all, the published index values are somewhat arbitrary; it’s only the percentage gains or...
Read MoreThe United States Supreme Court is taking up one of the most contentious legislative victories of the Obama administration: the Health Care and Education Reconciliation Act of 2010. The outcome will have important implications for the performance of U.S. health care stocks—and by extension, the broader U.S. stock market and economy—considering the industry accounts for 10.8% of U.S. market capitalization* and a large and growing part of U.S. GDP. The chart below illustrates the performance of the Dow Jones U.S. Health Care Total Stock Market Index since September 30, 2009. The index represents health-care providers as well as manufacturers and distributors...
Read MoreUsually, the announcement of a global chain store opening in a well-trafficked mall is not the making of headlines outside the local market. But when Gap Inc. announced the opening of a namesake store in South Africa, it was news on a couple of fronts. First, the opening came at a time when the retailer is closing stores in the U.S., reducing its footprint at home as it fuels up to expand overseas. The shift in direction came in response to the slowing U.S. economy, among other factors. To be sure, it’s a strategy that American job-seekers and consumers alike may...
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Surprise! Gas Prices Fall as Summer Driving Season Approaches
As I read the latest news on gas prices over the weekend, I was reminded of a quote from Homer Simpson: “This year I invested in pumpkins. They’ve been going up the whole month of October and I got a feeling they’re going to peak right around January. Then bang! That’s when I’ll cash in.” If Homer were buying gas futures, he’d probably buy in June and sell in September. After all, Americans traditionally plan their longest trips for their summer vacations. This factor usually drives up gas futures in the spring, along with the price at the pump, as consumers—and the...
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