Market Wrap-Up for Sept. 30 (CALM, PM, BDGE, JCI, more)

Amid fears that the United States government will partially shut down at midnight tonight due to Washington’s failure to pass a continuing budget resolution, stocks opened up deep in the red this morning. However, because today marked the last day of trading for September and the third quarter, it was likely that institutional investor portfolio maneuvering and traders buying on the dip helped boost the markets a bit throughout trading. Nonetheless, the major indices still finished in the red for the day.

Stocks on the Decline

Cal-Maine Foods (CALM) shares closed in the red today after the company reported first quarter earnings that did not please investors. Also, shares of Bridge Bancorp (BDGE) and Philip Morris International (PM) edged lower today following the announcement of their respective acquisitions. Furthermore, Johnson Controls (JCI) shares declined more than 2% due to a Wall Street analyst downgrade.

Stocks on the Rise

Among the few stocks to finish in slightly positive ground today were EQT Midstream (EQM), Xilinx (XLNX) and Amtek (AME), due to Wall Street analysts’ upgrades.

Be sure to check the Dividend Daily for all the latest earnings reports, analyst moves, and much more.

Take Advantage of a Washington-Induced Pullback

With the problems coming out of Washington today, it can be easy for dividend investors to be concerned that the budget issues will not be resolved and Wall Street will continue to react negatively to the circus perpetrated by our elected officials. I know that we’ve been at these crossroads time and time again over the past couple of years, but continually seeing your portfolio in the red due to seemingly silly standoffs in Washington can cause any rational investor to be concerned.

Especially alarming is that this is only the first of the two major battles to be fought by our policy makers this month, and in the eyes of most analysts this government shutdown is a minuscule issue compared to the debt ceiling debate. As we get closer to October 17 — the date in which the U.S. Treasury says the debt ceiling will be reached — I’m sure the markets will react accordingly and investors will be concerned about the potential losses. However, investors shouldn’t make irrational and emotional investing decisions because of what is going on in Washington. Yes, it could be a time to take some profits if your specific situation allows for it, but it is no reason to get out of stocks altogether. Over time these issues always get resolved. While there might be some big down days in the markets while the battle ensues, over the long-run stocks will continue to rise regardless of the short-term Washington-fueled blips.

Ultimately, if Wall Street does indeed react negatively to the Washington battles over the budget and debt ceiling, dividend investors should see this as an opportunity for the markets to pull back and initiate positions at more attractive buying opportunities. As it currently stands, stocks are relatively expensive, so for investors seeking better value and attractive yields, a pull back, regardless of the reason, should be seen as a welcome opportunity to add to your portfolio, ideally with your reinvested dividends.

Thanks for reading! Be sure to check us out on Twitter @dividenddotcom. We will see you tomorrow.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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