The Dow May Be High, but It's Not So Mighty; Drugstore Chains Hear Wal-Mart's Big Footsteps; Want to Play Santa at the Mall? Buff Up That Resume
The Dow May Be High, but It's Not So Mighty
Investors kept a ticker vigil last week to see if the Dow Jones industrial average would set an all-time record high. The benchmark index did trade above its record close of 11,722.98. But that's not the all-time high. For a brief moment in January 2000, the Dow traded as high as 11,750.28. And, if you adjust for inflation, the real record is closer to 13,800. Of course, the Dow is a rather narrow yardstick composed of just 30 stocks that are supposed to reflect the entire economy. The broader Standard & Poor's 500 index is a measure of the 500 largest publicly traded U.S. companies, and the Nasdaq composite index is made up of shares of more than 3,000 companies. And "you don't see the S&P or the Nasdaq anywhere near their all-time highs," says Jeffrey Hirsch, editor-in-chief of the Stock Trader's Almanac. Indeed, the S&P 500 is still 14 percent below its intraday record while the Nasdaq is down a whopping 56 percent from its mark set 6
Drugstore Chains Hear Wal-Mart's Big Footsteps
Wal-Mart's bold new program to start selling hundreds of generic prescription drugs for just $4 a month has been hailed as a "win-win." Not only will millions of uninsured Americans eventually gain access to cheaper medication, but Wal-Mart, the world's largest retailer, is scoring a public-relations bonanza. Actually, though, it's a win-win-lose. The losers in this case are the major drug retailers like CVS and Walgreens. As big as those two are, Wal-Mart is the undisputed 800-pound gorilla of retailing. And just as Wal-Mart has walloped competitors in virtually every category-most recently groceries-its move could handcuff drugstore chains. The brokerage Bear Stearns recently noted that "Wal-Mart ... is assaulting a retail business that possesses outsized margins. The result of such an assault has rarely been good for retailers." Indeed, since Wal-Mart's September 21 announcement, shares of CVS and Walgreens, the nation's No. 1 and 2 drugstore chains respectively, have both dropped 9 percent. The problem: The companies operate in Wal-Mart's shadow, sometimes literally. Nearly 9 out of 10 Walgreens stores and 8 of 10 CVS locations are within 5 miles of a Wal-Mart.
Want to Play Santa at the Mall? Buff Up That Resume
If you plan on earning extra holiday cash, you'd better get going. Competition for jobs is expected to be fierce this year because the nation's retailers aren't very likely to do much seasonal hiring, says outplacement firm Challenger, Gray & Christmas. Blame the housing market in part. It has fueled consumer spending in recent years, but now it's cooling fast. That means holiday spending could be modest.
This story appears in the October 9, 2006 print edition of U.S. News & World Report.
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