U.S. markets seemed to be struggling to start the week, with little major economic news or earnings reports to act as a positive catalyst today. Traders were looking ahead cautiously to a number of retail earnings reports coming later in the week. Companies set to report include Macy’s, Inc. (NYSE:M), Nordstrom, Inc. (NYSE:JWN) and Kohl’s Corporation (NYSE:KSS).
The Dow Jones Industrial Average dropped 0.4%, the S&P 500 fell 0.5%, and the Nasdaq was off 0.2%. Anticipation seemed to be the key word on Wall Street today, which led to a strong day for companies like J C Penney Company Inc (NYSE:JCP), Zillow Group Inc (NASDAQ:Z) and Rosetta Resources Inc. (NASDAQ:ROSE).
Here’s why they were among the day’s best stocks.
J C Penney Company Inc (JCP)
JCP stock was 3% higher as investors appear to be anticipating good news when the company reports earnings this Wednesday. Despite still having a “neutral stance on JCP, Sterne Agee had plenty to say about JCP, acknowledging that more profitable clearance sales and higher private label penetration are leading to improving revenue trends in JCP stores.
Traders seem to be pinning a lot of hope on good earnings from the retail sector driving the bull market as it bumps up against overhead resistance.
The thinking is that better weather may have pushed people back into brick-and-mortar stores.
Zillow Group Inc (Z)
Z stock was up over 6% after analyst Rob Peck of SunTrust Robinson Humphrey raised his rating on Zillow from “neutral” to “buy.” Peck noted that Zillow has a dominant market position that Wall Street tends to underestimate.
In addition, Wall Street is bullishly awaiting Zillow’s earnings report, which comes after Tuesday’s close.
OptionMonster.com is also reporting that a large number of May $104 strike calls were purchased between $1.55 and $2 on Monday morning.
Rosetta Resources Inc. (ROSE)
ROSE stock gave off a beautiful new fragrance today, up 27% after Rosetta announced that it was being acquired by Noble Energy, Inc. (NYSE:NBL) for $2.1 billion. The deal is expected to help Noble add hundreds of new drill sites to its total.
Traders also were saying that this could be the first of more M&A action among shale energy companies following a big decline in oil prices that started last summer.
According to the terms of the deal, ROSE shareholders get 0.542 shares of Noble for each share they hold. The acquisition values ROSE stock at $26.62 a share, a 38% jump since Friday’s closing bell.
ROSE stock closed at $24.58 today.
As of this writing, Ethan Roberts did not hold a position in any of the aforementioned securities.
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