The Commerce Department reported a 0.5% increase in retail sales for July — a fourth straight month of improvement — but the news did little to stem selling pressure to start the day.
However, afternoon remarks by Atlanta Federal Reserve President Dennis Lockhart indicating Fed tapering in September wasn’t a forgone conclusion, and that the Fed should move cautiously with such measures, helped spark markets as the day wore on, and the rebound extended for the remainder of the day.
The end result was an up day across the board, with the Nasdaq leading the way, closing ahead 0.39% to 3684.44, while the S&P 500 rose 0.28% to 1694.16. The Dow Jones Industrial Average closed up 0.2% to 15451.01.
The U.S. Justice Department filed a lawsuit to block a proposed $11 billion merger between US Airways (LCC) and American Airlines (AAMRQ) on the belief that the merger would hurt consumers through rising airfares. AAMRQ, which is currently in Chapter 11 bankruptcy reorganization, dove more than 45% while LCC shares were down more than 13%. Other airline stocks fell in sympathy, including United Continental (UAL, -7.5%), Delta (DAL, -7%) and Alaska Air (ALK, -3.1%).
Earlier in the day, JCPenney (JCP) stole the morning spotlight after activist investor Bill Ackman resigned from the board of directors amid the acrimony of his calls for changes at the executive level. Ackman still owns an 18% stake in JCP, and while shares rose initially on the news, that momentum didn’t last long as shares settled down nearly 4% by day’s end.
Apple (AAPL) continued to move ahead, rising nearly 5% after investor Carl Icahn tweeted that he’d taken a large (but undisclosed) position in the company.
Shares of Hewlett-Packard (HPQ) rose nearly 2% to lead the Dow after a judge dismissed a shareholder lawsuit accusing former CEO Mark Hurd of breaking internal ethics rules.
Microsoft (MSFT) shrunk back by about 1% on a downgrade at Stifel Nicolaus to “hold” from “buy.”
Earnings notables for Wednesday include Cisco (CSCO), Deere (DE) and Macy’s (M).
- Renren (RENN): Up 15.4% (61 cents) to $4.58.
- Micron Technology (MU): Up 8.2% ($1.14 cents) to $14.97.
- Cirrus Logic (CRUS): Up 3.8% (77 cents) to $21.11.
- Orbitz (OWW): Down 13.1% ($1.54) to $10.20
- Canadian Solar (CSIQ): Down 8.6% ($1.11) to $11.78
- Dendreon (DNDN): Down 5.9% (20 cents) to $3.17 (Read more here)
Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he was long AAPL.