Market Wrap-Up for Jan.31 (XOM, MAT, UPS, ADM, RSH, more)

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Interestingly enough, the market today did not make the month-end run-up we've become accustomed to be seeing. This phenomenon generally occurs when fund managers play games to spike their performance. So, what's to explain today's higher open and subsequent pullback into the red? It could be that the markets are simply a bit overbought in the short term.

Looking at today's earnings headliners, Mattel ( MAT ) ( full report here ) was a highlight on the upside following a big increase in the company's dividend payout. Most of the other earnings plays we have been highlighting ended lower, including shares of Exxon Mobil ( XOM ) ( more here ), United Parcel Service ( UPS ) ( report here ), Archer Daniels Midland ( ADM ), and Radio Shack ( RSH ) ( report here ), whose shares are getting lambasted today. Radio Shack has been passed around often in the land of "value" players. Fortunately for us, we have not agreed with that assessment and kept our distance.

Facebook Coattail Plays Flying Higher

A bubble has developed in the last few trading days, following rumors that Facebook may file for its IPO this week. Traders have set their sights on anything and everything related to the social media space. This trend means real danger for investors tempted by the 20-30% one-day moves.

I know the lure of quick gains can be hard to resist, but if your timing is off, you risk some very steep losses. Avoid rubbernecking the situation and stick to the dividend/income game plan if you can help it. Take it from a former trader that spent plenty of days trying to ride these wild horses: often times you'll wind up with nothing but stress and little gains to show for it.

Learning to Trust Your Judgement

I recently read about an experiment where a security guard was placed by an ATM machine that had an "out of order - please give your deposits to the security guard to be processed" sign. Guess what? Many people did in fact follow the instructions and gave their deposits to the security guard! A little risky, huh?

Clearly, some people need to be a bit more careful with their money. This same concept applies to the investing world, as all too many people simply follow advice from the wrong sources. It's critical to develop an ability to separate the good sources from the bad. Plenty of people rely on professional help these days when it comes to their finances, and there's nothing wrong with that. The trouble begins when investors listen to advice from wholly unqualified people like family members, friends, business colleagues, etc.

One of our biggest goals at Dividend.com is to make it easy for investors to develop a simply, conservative approach to investing. I often stress the importance of creating numerous income streams, and quality dividend paying stocks are a key element of that strategy. Once you have an online brokerage account set up at any of the well-known firms and you have access to our industry-leading Best Dividend Stocks List , your job becomes pretty easy. Again, it is great to gain as much knowledge from various financial professionals, but avoid putting your money at risk - don't rely on the security guard!

Two New Dividend Stocks Recommended Today!

We just upgraded two new dividend stocks this morning onto our industry-leading Best Dividend Stocks List . Be sure to check out our post detailing the upgrade if you haven't already.

Quick note - if the stocks are moving up too quickly following a recommendation, it may be best to wait for a pullback. Investing is a marathon, not a sprint!

Income, Income, Income

At Dividend.com, we maintain our focus on the best income-producing investments the markets have to offer during time of heightened volatility. We want to make sure we have only the most pullback-resistant names on our Best Dividend Stocks List . Also, if we see the market putting in what looks like a decent bottom, we will be prepared to scale up the list of stocks we like. Stay tuned and be sure to look for Dividend.com Premium member alerts along the way. Don't count on the government or your employer to set you up for a remarkable retirement. Take control, do your own research, and achieve your goals yourself!

Go Beyond This Newsletter

We know many of you enjoy reading the daily newsletter, but remember that with our Dividend.com Premium service, the newsletter is just one small component of what we offer. Here are the "Big Three" benefits of our Premium service:

- The Best Dividend Stocks List is used by tens of thousands of investors to help build their own portfolios.

- Creating your own Watchlist allows you to track the performance, news, and upcoming dividend payouts of the particular stocks you care about.

- Finally, we offer the most complete and easy-to-use dividend data on the web. Many subscribers use this data as part of a "Dividend Capture" trading strategy, but long-term investors can use it to keep track of impending payouts. Just visit our Ex-Dividend Calendar for a complete outlook on which companies will be paying out soon.

We don't ask for a credit card to use our free trial, and we don't bill you when your trial ends. No obligation whatsoever! So keep enjoying the newsletter, but please give Dividend.com Premium a shot if you haven't already subscribed!

Thanks for reading everybody. I'll 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 .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Created by Dividend.com


This article appears in: Investing , Stocks

Referenced Stocks: ADM , MAT , RSH , UPS , XOM

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