Street Suffers Earnings Jitters — Monday’s IP Market Recap

by Marc Bastow | July 9, 2012 5:35 pm

[1]Investors came back from a long holiday weekend with a lot on their minds, as the markets opened lower on concerns about second-quarter earnings[2] and uncertainty over Europe ahead of another eurozone meeting later this week.

By the end of the day, however, markets managed to stage a mild rally to end Monday modestly lower.

The Dow Jones Industrial Average was off 0.28% to 12,736, the Nasdaq fell 0.19% to 2,931 and the S&P 500 finished down 0.16% to end at 1,352.

According to CNN, 63 out of 103 companies lowered earnings projections for the quarter, leading to concerns about a still-slowing economy. Investors also turned their attentions to Europe, where the ministers of the eurozone countries will meet over the next two days to try and find a way to stabilize troubled banks and struggling economies.

The earnings season officially kicked off after the bell, as Alcoa (NYSE:AA[3]) reported a second-quarter loss that generally was in line with Wall Street projections, though revenues were better than forecast. AA shares were flat to slightly higher in after-market trading. (Editor Jeff Reeves gives his post-earnings take on Alcoa here.[4])

Unfortunately, much of the market damage was done prior to the end of the session, as industrial and energy shares led the declines. DuPont (NYSE:DD[5]), Caterpillar (NYSE:CAT[6]) and Exxon Mobil (NYSE:XOM[7]) all were down between 1% and 2% for the day.

A few stocks made minor moves on news, as Boeing (NYSE:BA[8]) rose amid an awarded contract by Virgin Australia[9] to deliver 23 units of its new 737 MAX airplanes, while Campbell Soup (NYSE:CPB[10]) and PepsiCo (NYSE:PEP[11]) dropped less than 1% after announcing the acquisition of Bolthouse Farms[12] and to enter into the yogurt business[13] through a joint venture with Germany’s Theo Muller, respectively.

The bad news at Best Buy (NYSE:BBY[14]

) continued, as the company announced a plan to lay off 2,400 employees, including 600 from its Geek Squad service and repair unit. The news sent the stock down nearly 2% for the day.

Discount retailers bucked the trend of the day, though. Family Dollar (NYSE:FDO[15]) was up more than 1.5%, Wal-Mart (NYSE:WMT[16]) rose 0.56% to reach a 12-year high and Dollar General (NYSE:DG[17]) gained half a percent.

Earnings season continues Tuesday with footwear and apparel maker Wolverine Worldwide (NYSE:WWW[18]) scheduled to release earnings in the morning. Results are due later in the week from Google (NASDAQ:GOOG[19]), JPMorgan Chase (NYSE:JPM[20]), and Wells Fargo (NYSE:WFC[21]), among other notable companies.

Three Up

• Amerigroup (NYSE:AGP[22]): Up 38% ($24.45) to $88.79.
• Kodiak Oil & Gas (NYSE:KOG[23]): Up 4.5% (38 cents) to $8.79.
• Seagate (NASDAQ:STX[24]): Up 4.1% ($1.02) to $25.97.

Three Down

• Alpha Natural Resources (NYSE:ANR[25]): Down 7.5% (65 cents) to $8.
• Arch Coal (NYSE:ACI[26]): Down 6.7% (48 cents) to $6.67.
• LinkedIn (NYSE:LNKD[27]): Down 5.4% ($5.88) to $102.98.

Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he was long XOM.

Source URL: https://investorplace.com/2012/07/earnings-jitters-scare-investors-mondays-ip-market-recap-aa-dd-xom-dd-cat-ba/

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