All three major U.S. markets sold off today, as continued strength in the dollar, plus a weaker than expected durable goods order, rapidly turned a slightly higher opening into a triple-digit loss.
The February durable goods orders were off by 1.4%, far short of what was expected to be an increase of 0.3%. It was the sixth consecutive month of durable goods declines, and the strong U.S. dollar was blamed for this month’s shortfall.
Elsewhere, political conflict in Yemen helped push the price of oil up, which sent the oil stocks higher.
The Dow Jones Industrial Average fell 1.6%, while the S&P 500 was off 1.4%. The Nasdaq Composite was the weakest of the three indices, losing 2.4% as traders took profits on many of the high-flying biotech stocks. Energy was the only sector on the plus side today.
Despite the big selloff, some stocks held firm or rose quite a bit, including Kraft Foods Group Inc (NASDAQ:KRFT), Lumber Liquidators Holdings Inc (NYSE:LL) and Stamps.com Inc. (NASDAQ:STMP), making them three of today’s best stocks.
Kraft Foods Group Inc (KRFT)
Some mergers are bigger than others, and the one announced today was a doozy. KRFT is set to merge with H.J. Heinz, in a deal formulated by Warren Buffett and 3G Capital Partners Inc., that will create the world’s fifth-largest food and beverage company.
The merger was valued around $36 billion, although no exact figure was released. Under the terms of the deal, KRFT shareholders will own a 49% stake while Heinz shareholders will hold a 51% stake in the newly formed company.
The announcement rocketed KRFT stock up more than 35% on 95 million shares.
Lumber Liquidators Holdings Inc (LL)
It might seem like bad news that Lumber Liquidators is now being investigated by the Consumer Product Safety Commission, as it analyzes LL’s flooring products for formaldehyde. But investors cheered the news and bid the stock up 10.5% today.
The reason is that the CPSC will not use “deconstructive testing”, but rather “finished goods testing” to analyze the formaldehyde content of the flooring in question. This is the same method used by LL, so the results are likely to validate LL’s claims that their flooring products are safe.
Stamps.com Inc. (STMP)
Under the terms of the deal, Stamps.com will pay $215 million in cash. Endicia, which has various brand names, made approximately $59 million in revenue for fiscal 2014.
The terms have already been approved by both boards of directors, and it is expected to close within five business days of the customary closing period. NWL stock was down less than 1% on the news.
As of this writing, Ethan Roberts does not hold a position in any of the aforementioned securities.