US STOCKS-Wall Street dips as retailer earnings disappoint

May 20, 2014
By

(Corrects name of chain store in second line of secondparagraph to TJ Maxx from TJX Maxx.)

* Retailers down after earnings

* AstraZeneca (NYSE: AZNnews) investor protests spurning of Pfizer (NYSE: PFEnews) bid

* Aeroflex jumps, to be acquired by Cobham (Other OTC: CBHMFnews) for $1.46 bln

* Indexes off: Dow 0.37 pct, S&P 0.32 pct, Nasdaq 0.45 pct

By Chuck Mikolajczak

NEW YORK (Frankfurt: HX6.Fnews) , May 20 (Reuters) – U.S. stocks dipped on Tuesday,weighed down by retailers after earnings from TJX Companies andStaples (NasdaqGS: SPLSnews) .

TJX shares slumped 5.7 percent to $55.07 as the biggest dragon the S&P 500 after the owner of off-price chain stores TJ Maxxand Marshalls (LSE: MSLH.Lnews) reported lower-than-expected quarterly revenue.

Staples Inc tumbled 10.8 percent to $11.95 afterthe office supply retailer posted first-quarter earnings andforecast a decline in sales in the current quarter. The S&Pretail index fell 0.4 percent.

“A lot of the rest of these companies, unless they aresolely focused on the East Coast, there was decent weather inother parts of the country, so that is kind of disturbing,” saidKim Forrest, senior equity research analyst, Fort Pitt CapitalGroup in Pittsburgh.

Caterpillar (NYSE: CATnews) shares dropped 1.8 percent to $103.45after the heavy machinery company said retail statistics for thethree-month rolling period ending in April were down 13 percent.

“So not only is the retail sector not doing well but neitheris heavy construction. It’s a little more concerning in thelarger equipment realm because to me that says new projectsaren’t being picked up either,” Forrest said.

Dick’s Sporting Goods estimated current-quarterearnings way below analysts’ average estimate and cut itsfull-year 2014 adjusted earnings and same-store sales growthforecasts due to weak demand for its golf and hunting products.Its shares plunged 15.7 percent to $44.80.

But Home Depot rebounded from premarket declinesafter the company’s chief financial officer said sales in Maywere “robust,” taking the sting out of its disappointingquarterly results. Its shares rose 1.8 percent to $77.90 as thebest performer on the S&P 500.

Equities have pulled back more than 1 percent since hittingtheir most recent record high May 13 as economic data haspainted a mixed picture and failed to confirm an acceleration inthe economy that many had hoped to see.

The Dow Jones industrial average fell 60.3 points, or0.37 percent, to 16,451.56, the S&P 500 lost 6.04 points,or 0.32 percent, to 1,879.04 and the Nasdaq Composite dropped 18.56 points, or 0.45 percent, to 4,107.25.

U.S.-listed shares of AstraZeneca advanced 2 percentto $72.07 after its twelfth largest shareholder, Schroders (LSE: SDR.Lnews) ,joined a chorus of investor disapproval over its rejection of atakeover offer by Pfizer and urged it back into talks.

Aeroflex Holding Corp (NYSE: ARXnews) jumped 25.8 percent to $10.45.British aerospace and defense supplier Cobham is buyingthe U.S. communications equipment maker for $1.46 billion. (Editing by Bernadette Baum)

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