Category: Stock Market News

Mattel Inc.’s stock tumbled 7.4% in morning trade Thursday, extending losses toward a 20-month low after the toy maker said it was slashing its dividend by more than half. The stock slumped 2.2% on Wednesday, after the company also said at its investor day in New York that it targeted revenue growth in the mid-to-high single-digit percentage range “in the medium-term.” UBS analyst Arpine Kocharyan said that while the dividend cut was already priced in, it’s difficult to value the stock based on “medium-term” targets, which provides little clarity regarding the timeline of a recovery. “If Mattel has found it challenging to forecast the business over a 6-9 month period, would investors be comfortable around valuing a highly seasonal earnings outloo,k that extends 3-4 years and Mattel’s conviction is issuing a mid-to-high single digit revenue growth guidance,” Kocharyan wrote in a note to clients. Kocharyan said that while the dividend cut does free up cash, the company didn’t provide specifics on how it would allocate that cash. The stock, which was trading at the lowest level since Oct. 5, 2015, has plunged 25.5% year to date, while the S&P 500 has gained 8.1%.

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Data from the U.S. Energy Information Administration Thursday showed that domestic supplies of natural gas rose by 78 billion cubic feet for the week ended June 9. Analysts surveyed by S&P Global Platts forecast a larger build of 89 billion cubic feet. Total stocks now stand at 2.709 trillion cubic feet, down 322 billion cubic feet from a year ago, but 228 billion cubic feet above the five-year average, the government said. July natural gas rose 7.4 cents, or 2.5%, from Wednesday’s settlement to $3.007 per million British thermal units. It traded at $2.955 before the data.

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The U.S. District Court in Oregon denied an Adidas AG motion for a preliminary injunction against Skechers USA Inc. that would have prevented Skechers from selling its Mega-Blade children’s shoes, Skechers announced on Thursday. The court also dismissed Adidas’ claim of “willful and intentional infringement” against Skechers. Adidas shares are down nearly 2% in Thursday trading, but up more than 51% for the past year. Skechers shares are down 0.3% in Thursday trading, and down 4.8% for the last 12 months. The S&P 500 index is up almost 17% for the last year.

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A measure of implied volatility on Wall Street on Thursday was on track to post its largest one-day rise since mid-May as U.S. equities saw firm losses, pressured by a resumption of selling in the highflying technology sector. The CBOE Volatility Index, or VIX, known colloquially as Wall Street’s fear gauge was up 10.5% at 11.76 at last check, putting it on track to rise by the most since May 17, when it popped more than 46%. The metric, which tracks options betting on moves in the S&P 500 index a month into the future, has been preternaturally quiescent over the past several months, but has had bouts of relative choppiness as investors fret about market valuations and absorb geopolitical developments, including the U.K.’s efforts to renegotiate longstanding trade agreements with the European Union. Thursday’s action comes as the Nasdaq Composite Index , which is on pace to fall four of the past five trading sessions, was suffering a sharp early decline, down 1.1% and on track to post its first losing month since October. Valuations around popular tech giants, including Facebook Inc. , Amazon.com Inc. , Google Inc.-parent Alphabet , Apple Inc. , and Netflix Inc. have raised concerns that those companies, known as FAANG stocks, have risen too far, too fast and are due for a sharp pullback. That sentiment has pressured the rest of the market, which has been aided in its recent run to all-time highs by the tech rally. On Wednesday, the Dow Jones Industrial Average finished at a record despite a broad-market decline. Those moves came after the Federal Reserve lifted key interest rates a quarter-point and detailed its plans to normalize monetary policy and reduce its $4.5 trillion balance sheet, accumulated during the 2008-’09 financial crisis. An accommodative central bank has been seen by some as underpinning what has been a eight-year bull market in equities. The jump in the VIX, however, hasn’t coincided with a clear flight to quality–typically associated with a rise in the fear index. Government bonds, for example, viewed as haven assets, were seeing some selling, with the 10-year Treasury note yield up 4.2 basis points at 2.17%, approaching its levels from the beginning of the week and well off its lows set Thursday. Bond prices and yields move inversely.

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A high-profile, annual dinner in London featuring top financial officials in Britain has been canceled Thursday. “In the light of the tragedy at Grenfell Tower we are cancelling tonight’s Mansion House Dinner,”the City of London Corp. said on Twitter. Bank of England Gov. Mark Carney had been scheduled to deliver a speech on his outlook of the British economy. Treasury chief Philip Hammond was also set to speak, but pulled out of the event. At least 17 people have been confirmed dead after a massive fire engulfed an apartment tower in west London early Wednesday. The death toll is expected to continue to rise, according to the Metropolitan Police.

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Nike Inc. said Thursday that it expects to cut 2% of its global workforce, or about 1,400 workers, as a result of a corporate restructuring. Nike has 70,700 employees according to FactSet. Called the “Customer Direct Offense,” the new corporate structure will focus on 12 cities across 10 countries, including New York London, Tokyo and Barcelona, which is expected to represent 80% of the company’s growth through 2020. The company will report based on four operating segments – North America; Europe, Mideast and Africa (EMEA); Greater China; and Asia-Pacific and Latin America (APLA). Each region has a vice president to lead it. The company is cutting 25% of its styles, and is cutting product creation cycles in half. Michael Spillane has been named to a new role, president of categories and products, to head this speedier process. The company is also increasing its direct-to-consumer efforts through a new Nike Direct organization led by Heidi O’Neill, president of the group, and Adam Sussman, chief digital officer. Nike shares are down 2.6% in Thursday trading and up 4.7% for the year so far. The S&P 500 index is up 8.3% for 2017 to date.

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U.S. stocks opened lower on Thursday, as a renewed selloff in technology shares weighed on the main indexes. Moderate losses on Wall Street follow the slight losses on Wednesday after the Federal Reserve raised interest rates by a quarter of a percentage point and indicated its plan to shrink the $4.5 trillion balance sheet will start sometime this year. The Nasdaq Composite was down 65 points, or 1.1%, to 6,129. The S&P 500 opened 15 points, or 0.6%, lower at 2,423. The Dow Jones Industrial Average began the session down 87 points, or 0.4%, at 21,285. Kroger Co was the top decliner on the S&P 500, falling by nearly 12%.

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Shares of Nucor Corp. dropped 2.9% in premarket trade, after the steelmaker provided a downbeat second-quarter profit outlook, as market conditions for hot-rolled sheet products have been more challenging than expected. The company expects earnings per share in the range of $1.00 to $1.05, below the FactSet EPS consensus of $1.22. “Nonresidential construction markets continue an overall positive trend, but conditions in the second quarter of 2017 have not been as robust as previously expected,” the company said in a statement. The company said imports continue to hurt the U.S. steel industry, as finished steel imports through the first five months of the year have increased an estimated 14% from the same period a year ago, and now account for 26% of the U.S. market. Nucor’s stock has eased 0.7% year to date through Wednesday, while the SPDR Materials Select Sector ETF has climbed 9.7% and the S&P 500 has gained 8.9%.

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Shares of Netflix Inc. were down 2.5% in premarket trade on Thursday leading FAANG stocks and the tech sector down amid a broad market selloff. Of the FAANG stocks, Facebook Inc. and Amazon.com Inc. were down more than 1%, while Alphabet Inc. (Google) fell nearly 2%. The selloff in FAANG stocks extends a selloff this week, in which Netflix, along with a few other tech stocks, crept into correction territory. Along with the FAANG stocks, Twitter Inc. was down nearly 2% in premarket trade on Thursday, while shares of Apple Inc. and Microsoft Corp. fell 1%. Nasdaq 100 futures were down 1% in premarket trade on Thursday.

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Amazon.com Inc. said Thursday that it has launched Prime Now one- and two-hour delivery service in Denver. The service includes two-hour delivery of groceries and fresh items from Sprouts Farmers Market Inc. . Prime Now delivery is available to Prime members and costs $7.99. In Denver, Sprouts deliveries are available from 8 a.m. to 10 p.m. every day. Prime Now is available in 30 U.S. cities. Amazon shares are down 1.5% in premarket trading, but up 36.7% for the past year. The S&P 500 index is up 17.7% for the last 12 months.

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