Category: Stock Market News

Shares of Citigroup Inc. shed 0.5% in morning trade Wednesday, after UBS did an about-face on the banking giant, flipping to bearish from bullish, amid concerns over how new protectionist policies may affect Citigroup’s global franchise. Analyst Saul Martinez gave the stock a rare sell rating, after it was at buy for nearly three years. He cut the stock price target to $58, which is 3.2% below current levels, from $64. Only 15% of companies covered by Citigroup have sell ratings. “Citigroup’s global franchise is generally a good thing, but it also leaves the company less levered to lower corporate tax rates and higher interest rates in the U.S., and more exposed to risks associated with the President-elect’s protectionist policy stances,” Martinez wrote in a note to clients. He said an underperforming Mexican franchise and Asia consumer businesses in slower growth markets also dampen his view. The stock has soared 20% since the election, while the SPDR Financial Select Sector ETF has climbed 18% and the S&P 500 has gained 6%.

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Target Corp. said Wednesday that it is launching a new kids line of apparel and accessories called Art Class. The brand will feature limited-edition capsule collections and other merchandise for both girls and boys. The first limited-edition line, The Class of 2017, was designed through a partnership with 10 children and includes 100 items like graphic tees and cut-off shorts. Art Class comes months after the launch of Target’s other children’s lines, Cat & Jack and Pillowfort. The retailer attributed back-to-school season strength to its kids business. Target shares are up 0.1% in Wednesday trading, but are down 1.3% for the last year. The S&P 500 index is up 18.1% for the past 12 months.

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Oil futures pared earlier gains Wednesday after the U.S. Energy Information Administration reported that domestic crude-oil supplies rose much more than expected. Crude stockpiles climbed by 4.1 million barrels for the week ended Jan. 6. The American Petroleum Institute late Tuesday reported a rise of 1.5 million barrels, according to sources, while analysts polled by S&P Global Platts forecast a climb of 1.75 million barrels. Gasoline supplies rose by 5 million barrels and distillate stockpiles jumped up by 8.4 million barrels, according to the EIA. February crude was up 11 cents, or 0.2%, at $50.93 a barrel on the New York Mercantile Exchange, compared with $51.35 before the data.

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Estee Lauder Cos. was downgraded Wednesday to neutral from buy at UBS on concerns that the beauty company’s growth prospects are at risk. Estee Lauder’s price target was cut to $84 from $93. UBS analysts believe Estee Lauer’s fiscal year 2017 currency-neutral growth guidance for a 6% to 7% sales increase is in danger after news of weakness at retailers like Macy’s Inc. . And lower prices in China could hinder price benefits for the second half of 2017. UBS Evidence Lab analysis also shows Estee Lauder brands are holding share, but not necessarily gaining it. Estee Lauder brands include Aveda, Clinique and Mac. “Given these concerns (plus negative FX and likely near-term dilution from Estee Lauder’s Too Faced acquisition that closed in late-December), we fear Estee Lauder may miss its fiscal-year 2017 top-line growth guidance…,” analysts wrote. Estee Lauder shares are down 0.3% in Wednesday trading, and down more than 7% for the last year. The S&P 500 index is up 18.1% for the past 12 months.

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U.S. stocks were marginally higher shortly after the opening bell Wednesday as investors remained on the sidelines ahead of a much-anticipated news conference from President-elect Donald Trump. The S&P 500 was flat at 2,268, hovering near its all-time closing high set last week. The Nasdaq Composite edged further into record territory, trading a points higher at 5,553. The Dow Jones Industrial Average added 23 points or 0.1%, to 19,876.

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Shares of American Airlines Groups Inc. rallied 1.1% in premarket trade Wednesday, after the air carrier raised its outlook for a key industry financial metric, citing improving yields. The company now expects total revenue per available seat mile (TRASM) to be flat to up 2% from a year ago, compared with a previous forecast of a decline of 1% to a rise of 1%. The FactSet TRASM consensus implies a 1.1% decline. For the month of December, the company said load factor fell to 80.6% from 81.6%, with traffic declining 0.8% and capacity increasing 0.5%. The stock has run up 27% over the past three months, while the NYSE Arca Airline Index has climbed 23% and the S&P 500 has gained 6.2%.

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The J.M. Smucker Co. said Wednesday it is raising the prices of packaged coffee products sold in the U.S. These include the Dunkin’ Donuts, Folgers and Cafe Bustelo brands, the company said in a statement. The moves comes at a time when coffee futures prices have been rising sharply, with the contract for March delivery gaining 8% in the year to date and 30% in the last 12 month, hurt by drought conditions in major coffee-producing countries. The iPath Bloomberg Coffee Subindex has gained 18.6% in the last 12 months, while the iPath Pure Beta Coffee ETN has gained 17.8%. J.M. Smucker shares were not yet active in premarket trade but are up about 7% in the last 12 months, while the S&P 500 has gained 18%.

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Israel-based Kornit Digital Ltd. said Wednesday it has granted Amazon.com Inc. warrants to buy up to 2.9 million Kornit shares over a five-year period at $13.03 a share, which is 6.6% below Tuesday’s closing price of $13.95. Kornit has about 31 million shares outstanding, according to FactSet. The digital textile printing company said the grant comes after Kornit was selected to deliver “a large number” of on-demand textile production systems to Amazon to support the Merch by Amazon program. “We are excited to have been selected as a garment printing solution provider for Amazon, and look forward to the business potential this relationship represents,” said Kornit Chief Executive Gabi Seligsohn. The stock, which is still inactive in premarket trade, has soared 39% over the past three months, while Amazon shares have slipped 4.2% and the S&P 500 has gained 6.2%.

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Walgreen Boots Alliance Inc. and FedEx Corp. are cooperating in a deal that will offer FedEx pickup and dropoff at Walgreens locations across the U.S. The service will start in the next few months, according to FedEx. “Walgreens, with its strong focus on customer care, is the perfect retailer to help us continue to meet the growing demand for convenient, secure dropoff and pickup options, and our research has shown that customers rank pharmacies as a preferred location for accessing their e-commerce shipments,” FedEx chief marketing officer Raj Subramaniam said in a statement. The companies will begin with a small-scale rollout this spring, and aim to have the service available at nearly 8,000 Walgreens outlets by the fall of 2018. Neither stock was active premarket. FedEx shares have gained 42% in the last 12 months, while the S&P 500 has gained 18%.

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Ethan Allen Interiors Inc. said Wednesday it expects fiscal second-quarter adjusted earnings per share of 38 cents to 39 cents, well below the FactSet consensus of 59 cents, amid a challenging retail environment. The furniture retailer expects total sales of $194.7 million, which is down from $207.5 million from a year ago, and below the FactSet consensus of $213.7 million. Delivered sales fell 6.2%, while written retail orders declined 3.6%. “Our plans are to start substantially increasing our marketing in both digital and traditional mediums starting from our current third quarter with continued increases as we move forward,” said Chief Executive Farooq Kathwari. The stock, which was still inactive in premarket trade, has soared 36% over the past 12 months, while the SPDR S&P Retail ETF has tacked on 7.8% and the S&P 500 has gained 18%.

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