Fed Concerns Hurt Again: Wednesday's IP Market Recap

Persistent concerns over the direction of the Fed’s easing policy continued to weigh on the markets Wednesday. Investors continued to sell out of positions as comments by the presidents of both the Atlanta and Chicago Federal Reserve suggesting the Fed might taper its bond purchases as early as September have cut into investor confidence.

All three major indices closed lower, with the Nasdaq again leading the way down, falling 0.32% to close at 3654.01, while the Dow Jones Industrial Average fell 0.31% to 15470.67. The S&P 500 lost 0.38% to close at 1690.91.

Earnings news played a role in the selling. First Solar (FSLR) sank more than 13% after announcing top- and bottom-line declines for the second quarter. The rest of the sector was hit, too, with SunPower (SPWR, -9.9%), Trini Solar (TSL, -9.6%), and Yingli Green Energy (YGE, -5.9%) among the collateral damage.

Real estate e-site Zillow (Z) fell more than 7% after announcing a Q2 loss of 30 cents per share despite record site visits and a nearly 70% improvement in revenues during the same period. Z also was downgraded from “outperform” to “sector perform” by RBC Capital. Sectormate Trulia (TRLA) shed nearly 5% in sympathy.

Retailer Ralph Lauren (RL) felt the sting of an earnings miss, dropping more than 8% as sales at stores open longer than a year fell 1% for its most recent quarter, and net income declined. RL also telegraphed modest growth of 4% to 7% for the full fiscal year.

JCPenney (JCP) continued its recent decline, falling more than 3% to price levels not seen since 2001.

Shares of Disney (DIS) continued a fall that started after hours Tuesday, as future earnings are expected to be impacted by the failure and expenses of its Lone Ranger movie release. DIS was down nearly 2%, the biggest loser in the Dow.

In after-hours action, Groupon (GRPN) rose more than 13% after announcing it beat second-quarter revenue estimates, logging $608 million in sales, and matched analyst estimates with a 1-cent loss. Groupon also announced that co-founder Erik Lefkoski will take over as chief executive officer from his interim position there.

Tesla (TSLA) fared almost as well, rising more than 10% after the bell thanks to blowing away estimates for a 17-cent loss with a 20-cent profit.

Earnings notables for Thursday include T-Mobile US (TMUS), Apollo Global Management (APO) and Rio Tinto (RIO).