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Stocks Close Lower as Yellen Testimony Looms

Dan Berman
Hot Stock Minute

Stocks moved lower today as traders awaited Janet Yellen's confirmation hearing tomorrow. They will undoubtedly begin listening to every word the Fed Chair nominee speaks for clues to the future of quantitative easing. There has been speculation that the central bank could in fact begin to taper its $85-billion-a-month bond-buying program in December, before current Chairman Ben Bernanke ends his term. In the meantime, the Bank of England revised its inflation and unemployment forecasts today, prompting expectations that it may soon raise interest rates.

POLL: Should hedge funds be allowed to buy Fannie Mae and Freddie Mac

Macy's (M) soared today, closing up more than 9% after posting solid earnings this morning. The department store chain made 47-cents a share for the quarter when estimates were for 39-cents. The beat is a 22% increase over last year. Sales came in at $6.28-billion, edging past estimates of $6.19-billion. Macy's credits an increase in marketing for the beat.

Extended Stay America (STAY) jumped in its debut today on the NYSE. Shares shot up more than 16% as the stock began trading. The hotel chain sold 28.25-million shares at $20 each. Extended Stay was publicly traded once before, but was taken private by Blackstone group. It subsequently changed hands again and then went bankrupt. The company is now led by former Starbucks CEO Jim Donald.

By contrast Chegg (CHGG) dropped double digits in its market debut. The company sold 15-million shares at $12.50. That was above the estimated range of $9.50 to $11.50. Chegg is an online textbook rental firm that also serves as a marketplace for a variety of student services like tutoring.

Potbelly (PBPB) popped 9% on its earnings which came out after yesterday's close. The company edged past revenue estimates with $78-million when expectations were for $77.88-million. Earnings, however, were 15-cents a share, easily topping expectations of 9-cents. The chain reported sales gains of nearly 12% over the last year, and same-store sales increases of 2.5%. Potbelly says it plans to open about 40 more stores before year's end.

Trucking company YRC Worldwide (YRCW) tanked 21% today. The company posted losses of $4.45 a share, nearly ten times the predicted losses of 46-cents a share. This despite revenues which were basically in line with expectations: $12.53-billion versus $12.60-billion. The company is blaming driver shortages and higher expenses for the earnings miss.

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