Stock Market News for August 6, 2010

Lackluster July same-store sales data and a surprise rise in initial jobless claims sent U.S. stocks lower on Thursday, as traders chose to play it safe ahead of Friday’s critical monthly payroll data.

The Dow Jones industrial average fell a modest 5.5 points, or 0.05%, to 10,674.98. The broader S&P 500 index slipped 1.43 points, or 0.1%, to 1,125.81, while the Nasdaq composite index fell 10.51, or 0.5%, to 2,293.06.  About four stocks dropped in price for every three that rose on the New York Stock Exchange, where volume came to 875.6 million shares.  The market’s measure of volatility, the CBOE Vix, rose above 22.

However, crude prices maintained their perch above $82, and the US dollar remained near a 3 ½-month low against a basket of currencies.  Retailers failed to impress with their sluggish numbers. Same-store sales increased 2.9% in July, below expectations of a 3.2% increase. However, some firms did turn in stellar performance during the quarter, with comparable store sales from The Limited Brands (NYSE:LTD - Analyst Report) jumping 12%. Macy's (NYSE:M - Analyst Report) sales increased 7.3% during the month. JC Penney's (NYSE:JCP - Analyst Report) comparable sales fell 0.6%, sending its shares off 7.7%.  BJ Wholesale's (NYSE:BJ) numbers rose 1.9%, below expectations of a 3.8% rise.

Kraft (NYSE:KFT - Analyst Report), a DJIA component, reported after-the-close results of 60 cents a share, 8 cents higher than expected, on revenue of $12.2 billion, up 25.3%. The company noted it is currently well-hedged against the soaring grain prices.  However, fears that grains costs would go up have sent Anheuser-Busch (NYSE:BUD - Snapshot Report) shares off 4.8% pre-market trading.

Russian move to ban grain exports in view of the drought in the country has fueled speculation consumer nations would turn to United States for supplies. Shares in grain companies Archer Daniel Midlands (NYSE:ADM - Analyst Report) and Bunge (NYSE:BG - Snapshot Report) gained more than 5% on the reports.

Hartford Financial Services Group (NYSE:HIG - Analyst Report) lowered operating earnings guidance for the year sent shares in the company down 5.4%.  Even as it swung to profitability in the second quarter, its lowered outlook for the year weighed on the financial sector. American Express (NYSE:AXP - Analyst Report) and Bank of America (NYSE:BAC - Analyst Report) dropped 2% and 1.2%, respectively.  Shares in Goldman Sachs (NYSE:GS - Analyst Report), which is planning to spin off its proprietary trading operations, dropped 0.3%.

Meanwhile, reports said BP (NYSE:BP - Analyst Report) has started pumping cement into the ill-fated well in the Gulf of Mexico.

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