Stocks leveled off today following yesterday's jump on the news of "no taper." The Dow and S&P 500 closed down slightly, while the Nasdaq managed to post modest gains. Traders appear to have digested the notion that the central bank won't be cutting its asset purchase program just yet. Prior to the announcement, prevailing wisdom was that the Fed would unveil at least a marginal taper of $5 billion or $10 billion in its current $85 billion monthly bond-buying program.
Rite Aid (RAD) climbed 24% on release of its earnings this morning. The drug store giant surprised Wall Street with its fourth straight quarter reporting a profit. The chain made 3-cents when expectations were for a loss of 4-cents. Compare that to a year ago, when losses were 5-cents a share. Rite Aid also beat on revenue which hit $6.3 billion versus expectations of $6.27 billion. Overall it has been benefiting from higher profit margins on generic drugs. Even ahead of this report, the stock was up 165%year-to-date and trading at its highest level in 5 1/2 years.
ConAgra (CAG) fell nearly 4% on an earnings miss. The company posted adjusted profits of 37-cents a share, 2-cents below estimates. Revenue was also about $90 million below expectations at $4.2 billion. The food conglomerate is citing soft sales, plus changes in merchandising for the disappointment. There is also what it calls a significant investment in new products being attributed to the miss. Prior to today, ConAgra was up 7% this year. That's in spite of an 8% drop over the past month.
Pier 1 Imports plunged (PIR) fell 14% on its earnings. The chain reported adjusted profits of 19-cents a share when estimates were for 21-cents. Revenue was also lower than expected at $395 million versus expectations for $405 million. Profits were down 32% from a year ago despite a 7% climb in sales. Moving forward, the company also lowered its outlook.
Groupon (GRPN) climbed 9% and hit a new 52-week high today. The online deal site moved on an upgrade to buy from hold. Stifel analyst Jordan Rohan says Groupon is experiencing accelerated growth in its core business domestically. Rohan says there are also signs of stability in Groupon's key European markets.
JPMorgan (JPM) fell over 1% on news of a $920 million fine in the London Whale trading scandal. The penalties include $300 million to the Office of the Comptroller of the Currency, $200 million to the Federal Reserve, $200 million to the SEC and about $220 million to the UK's Financial Conduct Authority. The penalties stem from faulty oversight. JPMorgan CEO Jamie Dimon released the following statement: "We have accepted responsibility and acknowledged our mistakes from the start, and we have learned from them and worked to fix them." Dimon originally labeled the Whale scandal "a tempest in a teapot."
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