Dow Loses 400 Points as Treasury Yields Rise; Oil profits marathon

Summary of stock indices: Share prices fall as part of broad sell-off 0ff

11 hours 55 minutes ago

Prov

Salesforce ( CRM ) rose 0.7% from its earnings report after the bell.

UnitedHealth (UNH) led the Dow lower, falling 3.8% after CEO Andrew Witty told a conference call that he expected some “disruption” to the company’s Medicaid profitability models as eligibility reviews resume after the Covid emergency declaration is lifted -19.

S&P500

Marathon Oil (MRO) rose 8.4% after ConocoPhillips announced it would acquire the oil producer in an all-stock deal worth more than $22 billion. ConocoPhillips (COP) fell 3.1%.

Nvidia (NVDA) rose 0.8%, paring initial losses and closing the session at another record high.

American Airlines (AAL) fell 13.5% after unexpectedly lowering its guidance for the current quarter.

Two of Wall Street’s favorite AI stocks, Super Micro Computer (SMCI) and Advanced Micro Devices (AMD), fell 4% and 3.8%, respectively.

Health plan provider Centene (CNC) followed UnitedHealth, falling 3.1%. UnitedHealth health insurance companies Elevance Health (ELV) and Humana (HUM) lost 2.6% and 1.1%, respectively.

Nasdaq 100

Consumer brands and retailers were able to benefit from a string of better-than-expected earnings reports from companies including Abercrombie & Fitch (ANF), Dick’s Sporting Goods (DKS) and Chewy (CHWY). Lululemon (LULU) and Ross Stores (ROST) each rose 1.1%, and Dollar Tree (DLTR) rose 0.7%.

Marvell Technology (MRVL) fell 3.3% from its quarterly earnings report before markets open tomorrow.

Most other semiconductor stocks lost ground, with ASML ( ASML ) losing 3.4% and Qualcomm ( QCOM ) losing 2.3%.

Abercrombie & Fitch stock breaks record thanks to rising sales and higher valuation

12 hours 28 minutes ago

Shares of Abercrombie & Fitch (ANF) rose to an all-time high on Wednesday as the apparel retailer’s first-quarter results easily topped estimates and the company’s outlook improved as sales rose across all regions and brands.

The company reported quarterly net income of $113.9 million – almost seven times the year-ago figure – with earnings per share (EPS) of $2.14, up from $0.32 in 2023. Revenue was up 22%. year-on-year to $1.02 billion, which is the first quarterly record. Profits and revenues exceeded forecasts.

Sales of the Abercrombie brand increased 31% to $571.5 million, and sales of the Hollister brand increased 12% to $449.2 million. In the Americas, they increased 23% to $820.1 million; 19% to $164.8 million in Europe, Middle East and Africa; and 10% to $35.8 million in the Asia-Pacific region.

Abercrombie now expects full-year sales to grow about 10% from $4.3 billion in fiscal 2023, compared with its previous forecast of growth of 4% to 6%. He sees an operating margin of about 14% compared to a previous forecast of about 12%.

Shares of Abercrombie & Fitch rose more than 23% shortly before markets closed on Wednesday. They have more than doubled this year and have increased sixfold in the last 12 months.

–Bill McCol

Dick’s Sporting Goods inventory grows as more shoppers and spend more

13 hours 32 minutes ago

Shares of Dick’s Sporting Goods (DKS) rose on Wednesday after the sports and recreation retailer posted better-than-expected results and improved its outlook as its stores saw an increase in shoppers spending more.

The company reported first-quarter earnings per share (EPS) of $3.30, with net sales increasing 6% year-over-year to $3.02 billion. Both exceeded estimates.

Comparable store sales increased 5.3%, compared to 3.6% a year earlier. Dick’s said this was due to an increase in transaction volume and average ticket volume. The profit before tax (EBT) margin was 11.3%.

The company now forecasts 2024 EPS in the range of $13.35 to $13.75, compared to the previous forecast of $12.85 to $13.25. It anticipates comparable store sales growth of 2.0% to 3.0% compared to its prior forecast of 1.0% to 2.0% growth.

Shares of Dick’s Sporting Goods rose 16% to $226.29 on Wednesday, after hitting an all-time high of $229.56 earlier in the session. In 2024, they gained over 50%.

–Bill McCol

Marathon Oil shares are skyrocketing after being acquired by ConocoPhillips for $22.5 billion

14 hours 40 minutes ago

Shares of Marathon Oil (MRO) rose Wednesday after ConocoPhillips (COP) announced it would acquire another Houston-based energy company in an all-stock deal valued at $22.5 billion, including $5.4 billion in debt net.

Marathon shareholders will receive 0.255 shares of ConocoPhillips for each share of Marathon they own, representing a premium of almost 15% over Marathon’s Tuesday closing price of $26.45.

ConocoPhillips said the acquisition will be “immediately accretive” to its earnings and cash flow and expects to generate “at least $500 million in operating costs and capital savings during the first full year after the closing of the transaction,” which it said would result in the fourth quarter of 2024 year.

Marathon’s shares rose by 7.8% on Wednesday afternoon, and have already increased by 18% this year.

-Aaron McDade

American Airlines shares fall after company lowers outlook, key executive leaves

15 hours 34 minutes ago

Shares of American Airlines (AAL) fell on Wednesday after the full-service carrier lowered its guidance for the current quarter and announced the abrupt departure of its chief commercial officer, Vasu Raja.

American, the world’s largest airline by fleet size, said it now sees second-quarter unit revenue decline by 5% to 6%, compared with its earlier forecast of a decline of 1% to 3%. The airline also lowered its earnings forecast for the period, saying adjusted earnings would be between $1 and $1.15 per share, below earlier guidance of $1.15 to $1.45 per share.

The airline’s soft guidance for the current quarter, which includes the busy summer season, was issued amid expectations for travel demand during the period to reach record levels.

In a separate statement late Tuesday, American said chief commercial officer Vasu Raja, who took over the position just over two years ago, will step down next month and be replaced on an interim basis by executive vice president and chief strategy officer Stephen Johnson.

American Airlines shares fell more than 14% early Wednesday afternoon, extending their year-to-date decline to about 16%.

-Timothy Smith

Chewy shares are rising on earnings beats as auto-delivery sales surge

16 hours 14 minutes ago

Shares of Chewy ( CHWY ) surged Wednesday after the e-commerce retailer of food and pet supplies reported earnings that beat forecasts and announced a new share repurchase plan amid a surge in auto-delivery sales.

Chewy reported first-quarter revenue of $2.88 billion, up 3.1% from a year ago and beating analyst estimates from Visible Alpha. Net income of $66.9 million nearly tripled from $22.86 million in the year-ago period, well ahead of expectations, while Chewy said adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) tripled compared year to year to a record level of USD 162.9 million. Diluted earnings per share were 15 cents, up 10 cents from a year earlier.

The company’s active customer count dropped 2.1% to 20 million, but net sales per active customer increased 9.6% to $562. Additionally, sales to Chewy’s drive-thru customers increased 6.4% to $2.23 billion and accounted for 77.6% of total sales compared to 75.2% a year earlier.

Chewy also said its board has approved a stock repurchase program worth up to $500 million with no expiration date.

Chewy shares were up 29% on Wednesday morning, up about 8% so far in 2024.

–Bill McCol

Stocks making the biggest moves in early trading

17 hours 28 minutes ago

Profits:

• Marathon Oil (MRO): Shares rose after ConocoPhillips (COP) said it agreed to acquire another Houston-based energy company in an all-stock deal valued at $22.5 billion.
• Dick’s Sporting Goods (DKS): Shares of the company jumped. The sportswear company reported better-than-expected results and improved its forecast as the number of shoppers in its stores surged and spent more.
• Robinhood (HOOD): Shares rose after the online discount brokerage firm unveiled a $1 billion share buyback program, signaling its maturity as a mature financial services provider.
• Abercrombie & Fitch Co. (ANF): Shares of the retailer rose after the company’s first-quarter earnings beat forecasts.

Losses:

• American Airlines (AAL): Shares fell after the airline lowered its second-quarter guidance and said a key executive was leaving.
• Cava Group (CAVA): Shares fell as the restaurant chain’s lower same-store sales offset higher-than-expected earnings and a rise in profitability.

US stock futures decline

19 hours 17 minutes ago

On Wednesday, Dow futures fell 0.6% in pre-session trading.

S&P futures fell 0.6%.

Nasdaq futures fell 0.6%.