Hardcore practitioners think that Dow Theory was ruined in January 1970 when Dow Jones dropped 9 of the 20 railroads and substituted three trucking companies and worse yet, six passenger airlines simultaneously changing the name from the Railroad Average to the Dow Jones Transportation Average.
The inclusion of FedEx and UPS brought the index back toward its original purpose, companies that move stuff.
UPS is down 3.41% at $75.29.
The trannies are down 1.21% at 4952.
I've no idea whether Dow Theory still works.
UPS, traditionally considered one of the legacy bellwether, came out with earnings. And they were ugly. The company missed both the top and bottom line, with the revenue coming at $13.35 billion, below expectations of $13.7 billion, and EPS at $1.15 on expectations of $1.17....MORE
This merely confirms what those who did not have their head in the sand in Q2 knew all along: without Europe, global trade stalls every time. But it was the outlook cut that was the cherry on top: "The company’s performance was mixed during the second quarter,” said Kurt Kuehn, UPS’s chief financial officer.
"The results in the U.S. Domestic and Supply Chain and Freight segments were partially offset by the weakness in International. “As we look toward the second half of the year, customers are more concerned as greater uncertainty exists. Additionally, economic growth expectations have come down,” Kuehn continued." China bull take note: "Revenue was $3 billion as the segment remains under pressure due to weaker global economies and reductions in exports from Asia." Going back to Kuehn: "Consequently, we are reducing our guidance for 2012 diluted earnings per share to a range of $4.50 to $4.70, an increase of 3%-to-8% over 2011 adjusted results.” ...
Here are those first six airlines, a motley crew: