Back to top

Market News

Dismal earnings numbers from Campbell Soup and a cautious profit forecast from Best Buy dragged the major indices into negative territory on Tuesday. The Dow moved away even further from the milestone level achieved on Monday. The S&P 500 incurred its first two consecutive days of losses this month. Meanwhile, Federal Reserve Chairman Ben Bernanke said the central bank will continue with its monetary policy till needed. He added that tapering will begin only after the labor market shows positive momentum. The energy sector was the biggest gainer among the S&P 500 industry groups while utilities lost the most.
 
For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article

The Dow Jones Industrial Average (DJI) slipped 0.1% to close the day at 15,967.03. The S&P 500 dropped 0.2% to finish yesterday’s trading session at 1,787.87. The tech-laden Nasdaq Composite Index fell 0.4% to end at 3,931.55. The fear-gauge CBOE Volatility Index (VIX) edged up 2.21% to settle at 13.39. Consolidated volume on the New York Stock Exchange was roughly 3.2 billion shares. Declining stocks outnumbered the advancers. For 66% shares that declined, 30% advanced.

Major indices dropped further from their respective milestones on Tuesday after Best Buy Co., Inc. (NYSE:BBY) gave a discouraging profit outlook, saying heavy promotions during the holiday season will impact margins. The company promised to provide competitive prices in the holiday season ahead. This is keeping with what other bellwether retailers have planned to do.
 
Thanksgiving and Black Friday are days when huge amount of shopping is done by consumers in a year. Consumer spending is a primary component of the economy, and the way consumers behave during the holiday season will give a rough idea to investors about the health of the U.S. economy.
 
Interestingly enough, Best Buy’s third-quarter fiscal 2014 earnings of 18 cents per share outpaced market expectations and reflected an improvement year on year. However, shares of Best Buy Co., Inc. dropped nearly 11% to $38.78 per share owing to the warning and investors overlooked the retailer’s earnings beat.
 
Campbell Soup Company (NYSE:CPB) reported dismal quarterly numbers and its shares dropped more than 6% to $39.20 per share. The world's biggest soup maker reduced its fiscal 2014 forecast. The company decreased its full-year adjusted earnings forecast to $2.53-$2.58 per share from $2.55-2.60.
 
Meanwhile, Fed chairman Ben Bernanke supported Janet Yellen’s position on monetary stimulus, saying that the economy needs to improve further before the program is ended. Bernanke said: "The FOMC remains committed to maintaining highly accommodative policies for as long as they are needed". "I agree with the sentiment, expressed by my colleague Janet Yellen at her testimony last week that the surest path to a more normal approach to monetary policy is to do all we can today to promote a more robust recovery," he added. The Federal Open Market Committee is scheduled to meet in December. Most economists don't expect the Fed to start reducing its bond purchases till their next meeting.
 
The energy sector was the biggest gainer among the S&P 500 industry groups. The Energy SPDR (XLE) gained 0.2%. Stocks such as Chevron Corporation (NYSE:CVX), Anadarko Petroleum Corporation (NYSE:APC), Apache Corporation (NYSE:APA), Phillips 66 (NYSE:PSX), and Marathon Oil Corporation (NYSE:MRO) added 1.2%, 0.4%, 1.1%, 0.8%, and 1.2%, respectively.
 
The utilities sector dropped the most among the S&P 500 industry groups and the Utilities SPDR (XLU) lost 0.7%. Stocks such as Duke Energy Corp (NYSE:DUK), Dominion Resources, Inc. (NYSE:D), NextEra Energy, Inc. (NYSE:NEE), The Southern Company (NYSE:SO), and Exelon Corporation (NYSE:EXC) lost 0.6%, 0.1%, 2.0%, 0.6%, and 1.1%, respectively.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
PLANAR SYST… PLNR 4.44 +5.21%
BITAUTO HOL… BITA 81.71 +5.12%
CTPARTNERS… CTP 16.66 +4.26%
CHINA BIOLO… CBPO 47.91 +3.30%
MALLINCKROD… MNK 72.94 +2.85%