Dow Jones Industrial Average – who were the winners and losers of 2023?
We look at the 2 big winners and the 2 big fallers on the Dow Jones in 2023, after a year in which the Dow has gained 12% and reached a new all-time high.
The Risers – Salesforce and Intel
2023 saw Salesforce and Intel emerge as the biggest gainers on the Dow, up 94% and 68% respectively (as of 13 December).
Salesforce
In the case of Salesforce, the company reported strong earnings results for its fiscal fourth quarter (Q4) of 2023, with revenue up 22% and an upbeat revenue outlook for the current fiscal year.
While the announcement of layoffs may not be seen as positive news, investors often view cost-cutting efforts as steps towards boosting profits. The involvement of activist investor Starboard Value has also generated optimism among investors, as they believe it will lead to operational improvements and cost cuts.
However, the departure of Co-CEO Bret Taylor and ongoing acquisition rumours may introduce some uncertainty into the company's future.
The Salesforce share price, which has risen by around 33% from its $193.68 late-October low, remains on track to overcome its $263.43 November peak and reach the 78.6% Fibonacci retracement of its 2021-to-2022 bear market at $272.20. The September 2021 high at $286.36 may also be reached in the Q1 of 2024.
Immediate upside pressure should be maintained while last week’s low at $246.89 underpins on a weekly chart closing basis.
Salesforce Weekly Candlestick Chart
Intel
For Intel, the new CEO Pat Gelsinger has brought renewed hope and optimism to Intel. His ambitious strategy to regain competitiveness, along with major manufacturing investments, has been well-received by investors.
Early signs of improvement in sales and earnings results suggest that Intel's turnaround efforts are starting to pay off. Additionally, there is optimism that the semiconductor market may be heading towards a cyclical upturn, which would benefit Intel and other chip stocks.
The Intel share price is once again trying to overcome its 200-week simple moving average (SMA) at $45.10 which capped the upside in November.
Given the strength of this week’s ascent it is probable that the November peak at $45.34 will soon be exceeded in which case the October 2021 low at $47.87 should be targeted.
Provided the Intel share price remains above its current December low at $41.17, the March 2022 peak at $52.51 could be reached.
Intel Weekly Candlestick Chart
The Fallers – Walgreens Boots Alliance and Chevron
By contrast, Walgreens and Chevron suffered the biggest falls in a year when 10 out of the index’s 30 members clocked up negative performances. Walgreens fell 34% and Chevron shed 19% (as of 13 December 2023).
Walgreens
Walgreens continues to face challenges in its retail pharmacy business. Falling same-store sales and lower customer traffic levels indicate a softening consumer demand.
Declining sales and fewer shoppers have squeezed profits, and the company's operating margins dropped in 2022. Walgreens also faces rising competition from retailers like Amazon, grocery chains, and discount stores, which offer more health and pharmacy services.
The loss of key partnerships with CVS and VillageMD further adds to the growth headwinds and uncertainty. Additionally, broader macroeconomic uncertainty, inflation, high gas prices, and fears of a potential recession in 2023 have driven investor pessimism around consumer/retail stocks like Walgreens.
The Walgreens share price has been slipping since 2015 and dropped by nearly 80% from its July 2015 peak to its late-November low at $19.68.
Since then a recovery rally is underway which has taken it above its October peak at $24.63. This is at least short-term encouraging for the bulls with the June low and 2022-to-2023 downtrend line at $28.14 to $28.68 representing possible upside targets, together wit the October 2022 trough at $30.39.
Walgreens Weekly Candlestick Chart
Chevron
Chevron, on the other hand, is facing challenges due to falling oil and gas prices.
The decline in commodity prices negatively impacts the company's earnings and cash flows, making its upstream assets less valuable. Fears of an economic slowdown or recession in 2023 have intensified, which could further reduce energy demand and drive down fuel prices, severely impacting Chevron's financial performance.
High inflation also poses challenges for the company, as it increases operating costs and squeezes profit margins.
Additionally, the global shift towards renewable energy sources may pressure long-term demand for Chevron's products and be influenced by government policies.
The Chevron share price is trying to bottom out and recover from its $140.72 low but is currently encountering stiff resistance at its $149.91 to $150.13 March-to-June lows.
Only if this resistance area were to be overcome, could a long-term recovery towards the breached 2021-to-2023 uptrend line, now because of inverse polarity a resistance line, at $163.65 be envisaged.
Chevron Weekly Candlestick Chart
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