It was a flat start to the week for stocks despite surprisingly strong retail sales in April. Investors pared early losses after the data showed a rise of 0.1% for the month when a drop of 0.3% had been expected. Still, the Dow ended slightly lower, while the S&P 500 and Nasdaq logged fractional gains. More news out of the retail sector is expected to dominate headlines later this week with Macy's (M), Wal-Mart (WMT), JCPenney (JCP), Nordstrom (JWN), and Kohl's (KSS) due to report quarterly earnings. Also the government releases CPI and PPI data, and the University of Michigan consumer sentiment index is due later in the week.
Post Holdings (POST) dropped over 5% on an abysmal earnings report. The cereal maker says net income fell 59% in the last quarter compared to the same period a year earlier. The company also missed estimates posting just 13-cents a share when consensus was for 27-cents. Revenue also missed estimates and was down. You may recall, Post was spun off from Ralcorp at the beginning of 2012. Just last week it announced the purchase of Hearthside which is a cereal, granola and snack company.
Shares of Tesla (TSLA) popped over 14%. They've been climbing ever since the company reported its first-ever quarterly profit last week. They also got a turbo boost again when Consumer Reports gave the company's Model S Sedan a 99 rating out of 100. Tesla says recent sales have surpassed expectations. The company is promising even better results just down the road as it ramps up production at an assembly plant in the San Francisco area.
San Francisco-based drug maker Theravance (THRX) saw its shares soar over 17%. That was on top of an 11% gain on Friday when the FDA approved a new drug the company has been testing for C.O.P.D. called Breo Ellipta. Over the weekend, the Irish pharmaceutical company Elan struck a $1 billion deal with Theravance for royalties on Breo Ellipta and three others in late-stage development. This is an intriguing deal because Elan has been fighting a takeover bid. But the company says the new deal with Theravance is totally independent of the other battle.
JC Penney (JCP) shares closed higher by nearly 3% on a report that bigger promotions this month at the chain have increased sales. Revenue plummeted 25% last year as then-CEO Ron Johnson tried to upend the chain's pricing policy. Former CEO Myron Ullman returned to JCP's top post just over one month ago. As part of its new turnaround effort the company has been running TV ads apologizing for recent marketing mistakes.