Hot Stock Minute

Stocks fall for third straight day; Facebook surges; LULU plummets

Hot Stock Minute

Wall Street had another down day after mixed economic news was released. Jobless claims shot up to 368,000, which was much worse than the 325,000 that was expected and the 300,000 that was posted last week. Retail sales saw its largest increase in five months, rising 0.7% last month after it increased 0.6% in October. The Dow Jones Industrial Average (^DJI) dropped 0.65%, while the S&P 500 (^GSPC) fell further below its record high reached earlier this week, to 1,775.51.

Poll: Has Lululemon lost customer and investor appeal?

While the S&P 500 had a down day, one of its newest members surged. Facebook (FB) climbed nearly 5% after it was announced the world's largest social media company was being added to the S&P 500 as well as the S&P 100. The addition will officially happen after the close on Friday, December 20, replacing Teradyne (TER) on the S&P 500 and replacing The Williams Inc. (WMB) on the S&P 100 Index. Other additions to the S&P 500 include Alliance Data Systems (ADS), which will replace Abercrombie & Fitch (ANF), and Mohawk Industries which will replace JDS Uniphase (JDSU).

Lululemon (LULU) saw its stock tank nearly 12% after it released its earnings report today. The news started out good as it posted profits of $0.45 per share, beating estimates of $0.41, and posted revenues of $379.9 million, beating estimates of $376.2 million. The bad news started when the yoga apparel retailer gave guidance for the next quarter at $0.78 to $0.80 a share, lower than analysts expectations of $0.84. It also expects revenues to be between $535 million and $540 million when analysts were expecting $572 million. The down forecast follows the company's founder Chip Wilson stepping down as chairman earlier this week, and the naming of its new CEO Laurent Potdevin.

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