Wall Street dips as retailer earnings disappoint

Wall Street dips as retailer earnings disappoint

NEW YORK - US stocks dipped on Tuesday, weighed down by retailers after earnings from TJX Companies and Staples.

TJX slumped 5.7 per cent to $55.07 as the biggest drag on the S&P 500 after the owner of off-price chain stores TJX Maxx and Marshalls reported lower-than-expected quarterly revenue.

Staples Inc (SPLS.O: Quote, Profile, Research, Stock Buzz) tumbled 10.8 per cent to $11.95 after the office supply retailer posted first-quarter earnings and forecast a decline in sales in the current quarter. The S&P retail index fell 0.4 per cent.

"A lot of the rest of these companies, unless they are solely focused on the East Coast, there was decent weather in other parts of the country, so that is kind of disturbing," said Kim Forrest, senior equity research analyst, Fort Pitt Capital Group in Pittsburgh.

Caterpillar (CAT.N: Quote, Profile, Research, Stock Buzz) shares dropped 1.8 per cent to $103.45 after the heavy machinery company said retail statistics for the three-month rolling period ending in April were down 13 per cent.

"So not only is the retail sector not doing well but neither is heavy construction. It's a little more concerning in the larger equipment realm because to me that says new projects aren't being picked up either," Forrest said.

Dick's Sporting Goods (DKS.N: Quote, Profile, Research, Stock Buzz) estimated current-quarter earnings way below analysts' average estimate and cut its full-year 2014 adjusted earnings and same-store sales growth forecasts due to weak demand for its golf and hunting products. Its shares plunged 15.7 per cent to $44.80.

But Home Depot (HD.N: Quote, Profile, Research, Stock Buzz) rebounded from premarket declines after the company's chief financial officer said sales in May were "robust," taking the sting out of its disappointing quarterly results. Its shares rose 1.8 per cent to $77.90 as the best performer on the S&P 500.

Equities have pulled back more than 1 per cent since hitting their most recent record high May 13 as economic data has painted a mixed picture and failed to confirm an acceleration in the economy that many had hoped to see.

The Dow Jones industrial average .DJI fell 60.3 points, or 0.37 per cent, to 16,451.56, the S&P 500 .SPX lost 6.04 points, or 0.32 per cent, to 1,879.04 and the Nasdaq Composite .IXIC dropped 18.56 points, or 0.45 per cent, to 4,107.25.

US-listed shares of AstraZeneca (AZN.N: Quote, Profile, Research, Stock Buzz) advanced 2 per cent to $72.07 after its twelfth largest shareholder, Schroders, joined a chorus of investor disapproval over its rejection of a takeover offer by Pfizer (PFE.N: Quote, Profile, Research, Stock Buzz) and urged it back into talks.

Aeroflex Holding Corp (ARX.N: Quote, Profile, Research, Stock Buzz) jumped 25.8 per cent to $10.45. British aerospace and defence supplier Cobham (COB.L: Quote, Profile, Research, Stock Buzz) is buying the US communications equipment maker for $1.46 billion.

Purchase this article for republication.

BRANDINSIDER

SPONSORED

Most Read

Your daily good stuff - AsiaOne stories delivered straight to your inbox
By signing up, you agree to our Privacy policy and Terms and Conditions.