Stocks sunk over 1% today putting U.S. markets on track for their worst week in four months. The Dow logged a 200-point loss as the session opened and never recovered. The losses appeared to be a combination of disappointing earnings reports and a continued fear that the Fed is about to begin tapering its bond-buying program aimed at stimulating the economy. Among today's economic data, the Labor Department reported that weekly jobless claims dipped to their lowest point since 2007, before the financial meltdown. The count came in at 320,000 when expectations were for more than 330,000 new claims.
Wal-Mart (WMT) shares moved more than 2% lower after the company reported quarterly earnings below analyst estimates. The world's largest retailer made $1.24 a share for the period, a penny short of the consensus. Revenue was more than $2-billion short of expectations for $118.5-billion coming in at $116.9-billion. Moreover, Walmart lowered both its profit and sales outlooks for the year saying tough economies here at home and abroad are likely to keep squeezing its low-income shoppers.
Kohl's (KSS) like Wal-Mart has missed earnings estimates by a penny. However, its shares rose 5%. The company says it made $1.04 a share when expectations were for $1.05. Revenue was right in line with predictions for $4.29 billion. Profits for the chain are down about 4% from a year ago and the company is now lowering the top end of its guidance for the year. Same-store sales rose 0.9% for the period compared to expectations of a 1.1% climb.
Another department store chain, Dillard's (DDS), rose 7% after beating estimates by 5-cents when it reported earnings of 79-cents a share yesterday afternoon, The company missed on revenue which came in at $1.52-billion versus $1.54-billion. But CEO William Dillard II says there were gains in same-store sales and profit margins.
Cisco (CSCO) shares fell 7% on the heels of its earnings which were released after yesterday's closing bell. The company's numbers were rather close to estimates: earnings of 52-cents a share after adjustments, and revenues of $12.42 billion. But Cisco says it will be laying off 4,000 workers, because it believes a slowdown is ahead. Prior to today, Cisco was up 30% year-to-date, largely on a spike after it reported earnings last quarter.
Red Robin (RRGB) was cooking today with shares up 8% on its earnings. The restaurant chain posted profits of 77-cents a share, 11-cents better than estimates. Revenue was under expectations at $238.3-million versus a consensus figure of $239.42-million. But that number was still 6% higher than last year. Moving forward, the company announced plans to open 20 more restaurants and remodel 20 existing ones.