BRICS Smash Bubbles in Boeing, 3M and These Dow Stocks

(Corrects story from earlier Friday to say 3M set an all-time intraday high of $140.43 on Dec. 31.)

NEW YORK (TheStreet) -- The Dow Jones Industrial Average set its all-time intraday high at 16,588 on Dec. 31, while the other major averages continued to set new highs between Jan. 15 and Jan. 23.

One of the factors that caused the Dow to peak first was the simmering turmoil in emerging markets.

The five Dow components I am focusing on today reached parabolic highs between Dec. 9 and Jan. 22, and all five now have negative weekly chart profiles as their stock specific bubbles popped. Boeing (BA) has been the biggest loser, down 15.1% since setting a new all-time intraday high at $44.57 on Jan. 22. 3M (MMM) lost 13.7% since setting its all-time intraday high at $140.43 on Dec. 31.

All international companies benefited from the global growth stories in emerging markets, but economic growth and potential inflation have made it more difficult to maintain profitability internationally. Many U.S companies have kept profits overseas to avoid corporate tax payments here at home, but now volatile currency fluctuations may adversely affect profitability.

These five Dow stocks should now be sold on strength.

American Express (AXP) ($85.69) has declined 5.4% since setting an all-time intraday high at $90.55 on Jan. 17. The company provides credit card and travel-related services worldwide and thus has tentacles in almost every emerging market. The stock traded as low as $82.61 on Feb. 2 above its 200-day simple moving average at $78.48. The weekly chart is negative with the five-week modified moving average at $86.52 and the 200-week SMA at $56.56. American Express has a hold rating and is 21.4% overvalued, with a gain of 41.5% over the last 12 months. My annual value level is $59.83, with semiannual and monthly pivots at $82.46 and $85.25, and quarterly risky level at $92.74.

Boeing($122.67) has declined 15.1% since setting an all-time intraday high at $144.57 on Jan. 22. The aerospace giant builds passenger airplanes for airline companies all over the world. If the emerging markets turmoil continues, some orders could be delayed or even canceled. The stock traded as low as $118.77 on Feb. 5, above its 200-day SMA at $116.04. The weekly chart is negative, with the five-week MMA at $132.00 and its 200-week SMA at $80.74. Boeing has a hold rating and is 11.6% overvalued, with a gain of 60.8% over the last 12 months. Semiannual and annual value levels are $117.06, $102.41 and $98.66, with quarterly and semiannual pivots at $120.52 and $123.73, and monthly risky level at $141.14.

3M ($128.90) has declined 13.7% since setting an all-time intraday high of $140.43 on Dec. 31. The diversified global multi-sector conglomerate has significant exposure to emerging markets. The stock traded as low as $123.61 on Feb. 3, above its 200-day SMA at 120.38. The weekly chart is negative, with the five-week MMA at $131.63 and its 200-week SMA at $95.34. 3M has a hold rating and is 19.8% overvalued, with a gain of 25.5% over the last 12 months. My semiannual and annual value levels are $120.48, $110.02 and $91.51, with quarterly and monthly pivots at $135.97 and $137.68.

Nike (NKE) ($71.51) has declined 10.9% since setting an all-time intraday high at $80.26 on Dec. 9. The company makes high quality athletic footwear and apparel worldwide. The stock traded as low as $69.85 on Feb. 5, staying above its 200-day SMA at $69.46. The weekly chart is negative, with its five-week MMA at $74.29 and its 200-week SMA at $50.83. Nike has a hold rating and is 19.2% overvalued, with a gain of 32% over the last 12 months. My quarterly value level is $58.15, with monthly and semiannual risky levels at $80.85 and $89.41.

United Technologies (UTX) ($109.45) has declined 7.4% since setting an all-time intraday high at $118.20 on Jan. 22. This multi-sector conglomerate provides building systems such as elevators and air conditioning used around the world as emerging market economies surged. The stock traded as low as $107.00 on Feb. 5, staying above its 200-day SMA at $104.15. The weekly chart is negative, with its five-week MMA at $111.63 and its 200-week SMA at $84.08. United Technologies has a hold rating and is 11.9% overvalued with a gain of 22.5% over the last 12 months. Semiannual and annual value levels are $104.66, $104.87 and $97.11, with a quarterly pivot at $113.70 and monthly risky level at $119.63.

At the time of publication the author held no positions in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff

Richard Suttmeier is the chief market strategist at ValuEngine.com. He has been a professional in the U.S. Capital Markets since 1972, transferring his engineering skills to the trading and investment world.

Suttmeier has an engineering degree from Georgia Tech and a Master of Science degree from Brooklyn Poly. He began his career in the financial services industry in 1972 trading U.S. Treasury securities in the primary dealer community. He became the first long bond trader for Bache in 1978, and formed the Government Bond Department at LF Rothschild in 1981, helping establish that firm as a primary dealer in 1986. This experience gives him the insights to be an expert on monetary policy, which he features in his newsletters, and market commentary.

Suttmeier's industry licenses include, Series 7 and Registered Principal (Series 24). He has been the Chief Market Strategist for ValuEngine.com since 2008 and often appears on financial TV.

Click here for details on Suttmeier's "Buy and Trade" investment strategy.

Richard Suttmeier can be reached at RSuttmeier@Gmail.com

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