Morningstar Indexes: Weekly Market Report

An improving geopolitical situation and rising inventories contributed to a slick decline in futures prices of oil to $65 per barrel last week. However, an up tick in labor costs and hawkish comments from Fed officials pushed the markets nervously lower. After an unusually strong 2.3% rise in the month of August, the Morningstar US Market Index finished the holiday-shortened week down 1%.

The Morningstar Market Barometer was red across the board as all nine Morningstar Style Indexes lost ground. The heaviest losses ran through small-cap and growth stocks. The Morningstar Small Growth Index being the worst performer posting a 2.1% loss. The Morningstar Large Core Index managed to be the best performer with a loss of only 0.5%.

Morningstar Large Core Index constituent Johnson & Johnson JNJ dropped 1.8% after losing an appeals court patent infringement ruling. In another legal development, Procter & Gamble PG lost a false advertising lawsuit against a key competitor of its osteoporosis drug Actonel, causing shares to decline 1.2%. Microsoft MSFT shares finished the week down about 1% after potential delays in European Union regulatory approval for the Vista operating system.

Adolor ADLR, a small-cap growth biotechnology firm, finished the week with the largest loss of any stock in the Morningstar US Market Index, plunging 47%. Disappointing late-stage trial results that will delay the launch of the new gastrointestinal drug Entereg were to blame.