U.S. stocks are inching lower Tuesday as a recent drop in bond yields continues to put pressure on banks. Department stores, apparel retailers and handbag makers are falling, but Amazon continues to rise. But energy companies are rising with the price of oil, and stocks are little changed overall.
KEEPING SCORE: The Standard & Poor’s 500 index was unchanged at 2,358 of 2:15 p.m. Eastern time. The Dow Jones industrial average rose 31 points, or 0.2 percent, to 20,681 after Boeing said it will sell $3 billion in aircraft to an Iranian airline. The Nasdaq composite remained at 5,894. The Russell 2000 index of small-company stocks lost 1 points, or 0.1 percent, to 1,368. On the New York Stock Exchange, more stocks fell than rose.
Trading is quiet Tuesday as investors wait for a series of reports on the U.S. economy and the meeting between President Donald Trump and Chinese President Xi Jinping starting Thursday.
BONDS: Bond prices fell. The yield on the 10-year Treasury note rose to 2.35 percent from 2.33 percent. However banks took losses for the second day in a row following a sharp drop in bond yields on Monday. Lower bond yields force interest rates on loans lower, which cuts into banks’ profits. KeyCorp slid 14 cents to $17.59 and Discover Financial Services lost 73 cents, or 1.1 percent, to $67.22.
RETAIL SLUMP: Ralph Lauren dropped $3.87, or 4.8 percent, to $77.50 after it said it will close stores and cut jobs in an effort to save money. The company will close its Fifth Avenue store in Manhattan less than three years after it opened. Urban Outfitters lost 79 cents, or 3.4 percent, to $22.41 after it said sales at older stores have fallen over the last two months. It said those sales fell more than expected.
Other retailers also lost ground. Department store Kohl’s fell $1.66, or 4.2 percent, to $37.69 and Gap shed 71 cents, or 3 percent, to $23. Online rival Amazon gained $12.25, or 1.4 percent, to $903.76.
Handbag and accessories maker Kate Spade slumped after Reuters said the company will take more time to negotiate a possible sale. The report cited anonymous sources and said that if Kate Spade is sold to a buyer like Michael Kors or Coach, it will likely be for less than the company’s recent valuation of $2.9 billion. Kate Spade sank $3.18, or 13.9 percent, to $19.63.
OIL: Benchmark U.S. crude rose 78 cents, or 1.6 percent, to $51.02 per barrel in New York. Brent crude, used to price international oils, added $1.01, or 1.9 percent, to $54.13 a barrel in London. Anadarko Petroleum added 74 cents, or 1.2 percent, to $62.5. The price of natural gas jumped 4.6 percent to $3.27 per 1,000 cubic feet, and Southwestern Energy climbed 57 cents, or 7.2 percent, to $8.46 while Range Resources gained $1.03, or 3.6 percent, to $29.60.
TELECOM TIE-UP: Alaskan telecommunications company General Communications agreed to be bought by holding company Liberty Interactive for $32.50 per share, or about $1.1 billion.
Liberty plans to combine General Communications with its cable TV and online assets, which include shares of LendingTree, Liberty Broadband, and Charter Communications, and spin them off into a separate company.
After that, Liberty Interactive will change its name to QVC Group and will focus on online retail. It also owns a stake in HSN.
General Communications jumped $12.7, or 62 percent, to $33.30 and Liberty Interactive added 44 cents, or 2.2 percent, to $20.4.
STAPLES TRYING AGAIN? Office supply company Staples climbed after the Wall Street Journal reported that Staples is talking to private equity firms about a potential sale. Staples tried to buy competitor Office Depot for $6.3 billion, but gave up on that effort last May after regulators opposed it and a federal judge agreed, saying it would reduce competition. Staples jumped 88 cents, or 10.2 percent, to $9.55.
CONN IS ON: Furniture and mattress retailer Conn’s surged after it announced a deal with Progressive Leasing, which will offer lease-to-own options to customers who don’t qualify for credit offered by Conn’s. Conn’s said working with Progressive could improve its sales. The company’s fourth-quarter adjusted profit and sales were also a bit better than analysts expected. The stock rose $2.66, or 31.5 percent, to $11.11.
LIGHTS OUT: Lighting maker Acuity Brands tumbled after its second-quarter profit and sales disappointed analysts. The company said the market for smaller projects remains weak, while sales in Europe, Mexico, and some other international markets were down and manufacturing costs were higher. The stock shed $29.04, or 14.2 percent, to $175.02.
METALS: Gold rose $4.40 to $1,258.40 an ounce. Silver added 11 cents to $18.32 an ounce. Copper rose 1 cent to $2.61 per pound.
CURRENCIES: The dollar slipped to 110.72 yen from 110.96 yen. The euro slipped to $1.0660 from $1.0665.
OVERSEAS: Britain’s FTSE 100 gained 0.5 percent and the CAC 40 in France rose 0.3 percent. In Germany, the DAX added 0.2 percent. The Japanese Nikkei 225 fell 0.9 percent as the yen gained against the U.S. dollar. The South Korean Kospi slipped 0.3 percent. Markets in Hong Kong and Shanghai were closed for public holidays.
BEFORE YOU GO…
… we’d like to ask for your support. More people are reading the Mississippi Business Journal than ever before, but advertising revenues for all conventional media are falling fast. Unlike many, we do not use a pay wall, because we want to continue providing Mississippi’s most comprehensive business news each and every day. But that takes time, money and hard work. We do it because it is important to us … and equally important to you, if you value the flow of trustworthy news and information which have always kept America strong and free for more than 200 years.
If those who read our content will help fund it, we can continue to bring you the very best in news and information. Please consider joining us as a valued member, or if you prefer, make a one-time contribution.Click for more info