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Dow, S&P 500 Drop 2% for the Week

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Stocks closed slightly negative today after two days of declines. The major indexes managed to come off their lows despite lingering fears about Fed policy and a sharply rising 10-year Treasury yield. The Dow and the S&P 500 both lost 2% for the week.

Investors had a number of economic reports to digest today. Chief among them was housing starts. The Commerce Department says starts rose 5.9% in July to a seasonally adjusted annual rate of 896,000 units. That was less than expectations which were for an annual rate of roughly 915,000 starts. Numbers for June were revised up to a pace of 846,000 units from a previously reported 836,000.

J.C. Penney (JCP) fell 3% on news that activist investor Bill Ackman may be preparing to sell his shares of the embattled retailer. Penney and Ackman have struck a deal which would allow him to sell restricted shares of the company's common stock. Ackman resigned from the board earlier in the week after publicly calling for the ouster once again of recently reinstalled CEO Myron Ullman. Ackman currently holds 18% of J.C. Penney stock which makes him the largest shareholder.

Joseph A. Bank (JOSB) fell 7% on news the chain is having trouble giving its merchandise away. The company says customers have not been responding to its high-volume sales campaigns. Offers include things like buy one suit, get five items free. Nevertheless, the clothier says sales and profits will both fall short of expectations for the quarter. At this point, the CEO is predicting profits between 49 and 53-cents a share, down from earlier estimates of 68-cents. Revenue will likely be shy of $232-million when earlier estimates were for more than $270-million.

Upscale department store chain Nordstrom (JWN) dipped 5% today on its earnings which were released after yesterday's closing bell. The chain beat by a nickel on the bottom line, posting profits of 93-cents a share. But revenues were about $90-million short of expectations at $3.20-billion. Nordstrom is also cutting its full year forecast. Same-store sales for the period just ended were actually up more than 4% from a year ago. But analysts were looking for gains of almost 7%.

Dell (DELL) shares rose nearly 1% after reporting earnings after yesterday's closing bell. They beat the street, but were still dismal compared to last year: adjusted earnings were 25-cents a share, a penny above estimates but down from 42-cents a year ago. Revenue was also above the consensus at $14.5-billion when estimates were for about $14.2-billion. Dell says its woes have been worsening with a decline in PC sales forcing it to cut prices. By the way, competitor Lenovo says it is now selling more tablets and phones than PCs.

BlackBerry (BBRY) fell another 4% as the company struggles to carve out a future path. This latest drop comes amid revelations that if BlackBerry were sold and CEO Thorsten Heins were ousted, he would be paid close to $56-million dollars. BlackBerry revealed earlier this week that it is exploring all options including a sale of the company.

Pandora (P) climbed more than 2% after Goldman Sachs raised its price target to $27 from $18 a share. Analyst Heath Terry says he is encouraged by three consecutive quarters of accelerating growth. He also says the company seems to understand its competition. This rise adds to gains of 109% year-to-date.

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