On Tuesday, markets shed their winning streak to fall marginally lower. Figures of lower than expected retail sales were disappointing enough to take the indices down. Moreover, weak energy and technology shares added to the jitteriness of investors.
The Dow Jones Industrial Average fell 0.34% and closed at 12,226.64.The S&P 500 dropped 0.32% and closed at 1,328.01. The tech-laden Nasdaq fell 0.46% and ended the day at 2,804. On the New York Stock Exchange, breadth of the market was on the negative side and for every 8 stocks that fell, 5 stocks ended in the green with only 571 million shares being traded.
Coming to economic news, a report from the commerce department said for the month of January retail sales increased 0.3% lower than the 0.6% increase which economists were expecting. On the other hand, business inventories increased 0.8% in December against the expected increase of 0.6%. In other economic news, the New York Fed reported increased manufacturing activity in the New York region with the Empire State manufacturing index rocketing to 15.43 from 11.92. Coming to housing news, a report from the National Association of Home Builders said the housing market index remained unchanged at 16.0.
Chinese inflation was the major international concern weighing on the minds of nervy investors. On Tuesday China said inflation increased 4.9% in the month of January, with costs of foods spiking up as high as 10.3%. Overall, global markets remained mixed as Hang Seng and London’s FTSE fell 1% and 0.4% while Japan’s Nikkei and Germany’s DAX increased 0.2% and 0.05% respectively.
On a sectoral basis, shares of materials and energy were the most affected by China’s higher inflation rate. Share prices of Exxon Mobil Corporation (NYSE:XOM) fell 2.28% to close at $82.97 and led the blue chip retreat. The other key energy shares to lose include Marathon Oil Corporation (NYSE:MRO), Hess Corp (NYSE:HES) and Chevron Corp (NYSE:CVX). Shares of these companies fell by 0.98%, 1.14% and 0.61% respectively to close in the red.
Coming to earnings and estimates news, world’s No 2 PC maker Dell (NASDAQ:DELL) reported better than expected earnings results after Tuesday’s closing bell with a net profit of $927 million, up from $334 million year over year. However, shares of the company fell 1.28% to $13.91. Shares of Limelight Networks Inc (NASDAQ:LLNW) increased after the company reported better than expected fourth quarter earnings results. The content-delivery provider’s share prices spiked up 26.93% to close at $8.20. Insurance brokers Marsh & McLennan Companies Inc (NYSE:MMC) gained 4.71% to close at $30.23 after the company posted better than expected quarterly profits beating Street’s expectations.
On to news of mergers and acquisitions, billionaire Edward Lampert announced his plans to purchase a 5.8% stake in Gap Inc (NYSE:GPS). Reacting to the news, the apparel chain’s share price gained 6.10% to close at $22.78. Share prices of NYSE Euronext (NYSE:NYX) declined 3.4% after Deutsche Boerse got the nod to acquire the company to create the world’s largest exchange operator.
CHEVRON CORP (CVX): Free Stock Analysis Report
DELL INC (DELL): Free Stock Analysis Report
GAP INC (GPS): Free Stock Analysis Report
HESS CORP (HES): Free Stock Analysis Report
LIMELIGHT NETWK (LLNW): Free Stock Analysis Report
MARSH &MCLENNAN (MMC): Free Stock Analysis Report
MARATHON OIL CP (MRO): Free Stock Analysis Report
NYSE EURONEXT (NYX): Free Stock Analysis Report
EXXON MOBIL CRP (XOM): Free Stock Analysis Report
Zacks Investment Research
