Stocks closed mixed. The Dow and the S&P 500 rose slightly after House leaders from both parties met on Capitol Hill. Also, President Obama set up meetings with Republican and Democratic leaders to discuss the budget and debt ceiling. In other news President Obama ended months of speculation by officially nominating Janet Yellen to be the next Fed Chair. Her confirmation is expected to come without much fuss.
Men's Wearhouse (MW) skyrocketed 28% to $45 a share on news of a suitor. Smaller competitor Jos. A. Bank (JOSB) says it's willing to pay $2.3 billion or $48 a share for the troubled clothing chain. Men's Wearhouse, however, doesn't like the way the deal looks, saying it undervalues the company. The chain has been in turmoil since the ouster of its Founder and Executive Chairman George Zimmer in June. As for Jos. A. Bank, it also got a jolt today, climbing 8% in intraday trading. Prior to today, the stock had been down 3% this year.
J.C. Penney (JCP) rose over 1% on word that Saks Chairman and CEO Stephen Sadove will join the Penney board after Hudson's Bay has completed its acquisition of Saks. Penney competitor Sears (SHLD) dropped 4% on a report that it has quietly sold nearly a dozen of its most profitable stores, many of them over the summer.
Family Dollar Stores (FDO) fell 1% after its adjusted earnings came in at 86-cents a share, beating estimates by 2-cents a share. Sales, however, slightly missed the consensus at $2.5-billion versus $2.56-billion.
Costco (COST) rose 2% despite missing on both the top and bottom lines in its latest quarterly report. The discount chain earned of $1.40 a share when expectations were for $1.46. Revenues were more than $1-billion short of consensus at $31.77-billion. On the positive side, same-store sales rose 3%.
Yum Brands (YUM) sank more than 6% on its earnings. The fast food giant disappointed with quarterly earnings of 85-cents a share when expectations were for 93-cents. As for sales, they also came up short at $3.47-billion versus $3.53-billion. Ongoing weakness in China gets the blame. Yum now says a recovery from a chicken scandal at its KFC restaurants will take longer than previously predicted. Prior to today's losses, Yum shares were up 7% year-to-date.
Alcoa (AA) shares climbed 2% on the company's report which came out after yesterday's closing bell. Alcoa says it made 11-cents a share, when analysts were calling for just 5-cents. Revenue was also above consensus at $5.77-billion compared to $5.63-billion. Not only was Alcoa recently booted from the Dow, it has been a market laggard this year, down 12% going into today's session.
Finally, there was more blood today in the tech sector. Yesterday's biggest losers dropped disproportionately again. Among the companies posting the largest percentage losses during today's regular session were Netflix (NFLX), Pandora (P) and Yelp (YELP).
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