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Tuesday's Scare: False Alarm or Fair Warning?

Tuesday's Scare: False Alarm or Fair Warning?

It's not every day that a 126-point loss from the Dow deserves such a big sigh of relief. But considering the industrial average tanked at Tuesday's open and was off by almost 550 points before lunch...investors were rightfully thankful to close at 25,191, down 0.5%. The catalyst for the early morning panic? Construction equipment maker Caterpillar (CAT, -7.6%) offered up disappointing full-year earnings guidance, and conglomerate 3M (MMM, -4.4%) lowered its profit forecast.

That troubling news from two industrial bellwethers reinforces a couple of important lessons. For one, a few specific earnings reports are must-watch material -- even if you don't own those stocks. Caterpillar delivered a loud, clear message that American tariffs are cranking up costs, making it all the more important this earnings season to identify stocks that are already getting pinched by America's trade war. Also, the selloff that ensued pointed us in the direction of the few areas of the market that can actually benefit on days like today. Bond funds, such as these great low-fee options, received a bid because of their relative stability and steady income. Utility stocks also were far less choppy than the rest of the market and a few even finished in the black Tuesday. These 10 utility stocks, while admittedly dry as a bone, are highly regulated, typically predictable safe havens that deliver not just stable dividends, but often high yields, too.

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