Stock Market Today: Goldman, Travelers Drag Dow Lower

Stocks took different directions to start the short week. (Monday was a stock market holiday to celebrate Martin Luther King Jr. Day.) 

While the tech-heavy Nasdaq kept its win streak alive, disappointing earnings from financial giant Goldman Sachs (GS) pressured the blue-chip Dow Jones Industrial Average. 

This morning, Goldman Sachs said fourth-quarter profit plunged 66% year-over-year to $3.32 per share as merger-and-acquisition activity dried up amid rising interest rates and an uncertain economic backdrop. Revenue fell 16% to $10.6 billion. Both figures fell short of analysts' consensus estimates, and the stock plummeted 6.5% in reaction. 

From just $107.88 $24.99 for Kiplinger Personal Finance

Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues

CLICK FOR FREE ISSUE

Sign up for Kiplinger’s Free Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Sign up

Travelers Companies (TRV) also created headwinds for the Dow on Tuesday. Shares slid 4.6% after the insurance company said it expects Q4 earnings to come in lower than expected due to what CEO Alan Schnitzer called "catastrophic weather." TRV is slated on the earnings calendar to report its full fourth-quarter results before the market opens next Tuesday, Jan. 24.

At the close, the Dow was down 1.1% at 33,910, while the S&P 500 shed 0.2% to 3,990. The Nasdaq Composite, meanwhile, gained 0.1% to 11,095, its seventh straight win. 

The Best Dow Dividend Stocks

Despite today's lower finish for the Dow and S&P 500, it's been a pretty strong start for the equities market. Year-to-date gains for the major benchmarks range from 2.3% to 6%. According to John Osterweis, founder and co-chief investment officer at Osterweis Capital Management, investors can expect higher future returns, too. 

But there's no clear timeline as to when the market will shift from bear market to bull market, and stock prices could go lower in the meantime. So what are investors to do? "The key is to position portfolios to withstand the near-term risks stemming from possible recession and inflationary cost pressures on the one hand, and on the other, to benefit from the eventual economic upturn that will inevitably follow any slowdown," Osterweis says. 

This can include buying the best dividend stocks, which Osterweis says can "prove to be superior investments." Additionally, investors should seek out companies "with strong balance sheets and substantial cash flows" as they "are better able to navigate difficult times and are thus able to gain market share during rough periods." These are qualities found in the best Dow dividend stocks, which provide investors with reliability and stability, as well as market-beating yields.