The markets were higher to start the day today, led by a strong move in energy (XLE ). Earnings held back the major averages as Walmart (WMT ) saw some selling pressure after reporting better than expected earnings, along with Cisco (CSCO ) which disappointed.
After comments from President Trump about China the markets began their move lower. Ultimately, the Dow 30 closed lower by 54, the S&P 500 lost 2, and the Nasdaq 100 lost 15 on the day. Earnings in the retail space continue to be a focus as investors get a clear picture of how the spring shopping season seems to be off to a late start thanks to a longer winter. Interest rates were also a factor as the 10 year note pushed above 3.1% for the first time since 2011
Wells Fargo (WFC ) was back in the news again for unethical practices. A report from the Wall Street Journal said that Wells Fargo employees "improperly altered or added information on documents related to corporate customers." without customer consent. The activity took place last year and early this year as the bank was trying to comply with a regulatory consent order over anti-money laundering controls, the report says. Shares were lower by 1.49%.
JC Penny (JCP ) shares tanked today, losing 12.38% as the company reported earnings that missed expectations as well as lowered guidance going forward. Revenue fell 4.3%, and same store sales came in well below the 2% growth mark expected by Wall Street. The company tried to blame the performance on a longer winter but investors had none of it. Shares are now lower by over 30% in the last year.
Tesla (TSLA ) was once again in the news, but this time thanks to an aggressive report from an analyst at Goldman Sachs (GS ) that said the company would need to raise as much as $10 billion in the next two years to stay afloat. The report says that they should have no problem raising the money but that it would have an adverse effect on share prices which they expect to fall to $195 in the next 6 months.
In other news, it appears that surging interest rates are not deterring buyers. It seems that they are moving even faster to buy what little, affordable inventory there is. According to Freddie Mac the average 30 year interest rate rose to 4.61% last week and homes went under contract after a median 36 days on the market. This is the fastest since 2010 according to redfin. Home prices jumped 7.6 percent in April from a year earlier to a median of $302,200, and sellers got a record 98.8 percent of what they asked on average, Redfin said Thursday.
