U.S. Markets closed

European and US Markets Red on Wednesday

- By Omar Venerio

U.S. stocks were in negative territory on Wednesday, extending the previous day's losses. The Dow Jones Industrial Average fell 1.09% to 25,070, the S&P 500 index declined 0.80% to 2,779 and the Nasdaq Composite Index slid 0.77% to 7,549.

Shares of Abercrombie & Fitch Co. (ANF) plunged more than 25% on Wednesday after the company announced first-quarter results. Revenue grew 0.4% from the prior-year quarter to $733.97 million, beating expectations by $3.18 million. A loss of 29 cents per share also topped estimates by 14 cents.


"We achieved our seventh consecutive quarter of positive comparable sales, fueled by ongoing strength at Hollister and a return to positive comps at Abercrombie," CEO Fran Horowitz said. "This contributed to top-line growth, operating margin improvement and a net loss reduction compared to last year."

During the quarter, the gross profit margin was 60.5%, flat when compared to the year-ago quarter. The operating margin inched up 210 basis points to 3.7%

Looking ahead to the second quarter, the company expects net sales to be flat to up 2%, with comparable sales not growing. It also projects the gross profit margin to be down 100 basis points from 60.2%.

For the full year, the company projects net sales to grow between 2% and 4%, driven by positive comparable sales and net new store contribution. The gross profit rate is expected to surpass 60%. The company plans capital investments of $200 million.

Gainers

  • Helmerich and Payne Inc. (HP)
  • Seagate Technology PLC (STX)
  • Qorvo Inc. (QRVO)
  • Deere & Co. (DE)
  • Edison International (EIX)



Losers

  • L Brands Inc. (LB)
  • General Mills Inc. (GIS)
  • Macerich (MAC)
  • Allergan PLC (AGN)
  • Tyson Foods Inc. (TSN)



Global markets

The main European stock markets traded deep in the red. The U.K.'s FTSE 100 tumbled 1.15%, France's CAC 40 retreated 1.70%, Germany's Dax fell 1.57% and Spain's IBEX 35 slid 1.21%.

In Asia, Japan's Nikkei 225 fell 1.21%, India's BSE Sensex slipped 0.62%, Hong Kong's Hang Seng swelled 0.57% and China's Shanghai Composite rose 0.16%.

Disclosure: The author holds no positions in any stocks mentioned.

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This article first appeared on GuruFocus.