Stocks Extend Losses as Priceline Leads Consumer Losers
Stocks extended losses by mid-morning Monday as Priceline (PCLN) was a laggard in the consumer sector.
The S&P 500 fell 1%, the Dow Jones Industrial Average slid 1%, and the Nasdaq declined 1%.
Priceline fell 9.2% after guiding for a weaker-than-expected fourth quarter. The online travel agency expects fourth-quarter profit no higher than $11.90 a share, well below estimates of $12.42. The company did beat expectations in its recent quarter, though, earning $25.35 a share, above estimates of $24.21.
The company weighed on the consumer stocks sector, the worst performer on Monday. Amazon (AMZN) - Get Report , Tesla (TSLA) - Get Report , Netflix (NFLX) - Get Report and Costco (COST) - Get Report moved lower, while the Consumer Discretionary SPDR ETF (XLY) - Get Report fell 1.6%.
A stronger-than-expected October jobs report on Friday shored up the chances of a December rate hike, which would be the Federal Reserve's first move higher in nearly a decade. The likelihood of a December hike is now 70%, up sharply from a 30% chance several weeks ago, according to CME Group's Fed funds futures.
San Francisco Fed President John Williams said on Saturday that policy normalization was the "next step" as the U.S. labor market continues to tighten and inflation moves back to target levels.
"I do think it makes sense to gradually remove the policy of accommodation that helped get the economy to where we are," Williams said at an event for the Arizona Council on Economic Education. Williams declined to say whether he backs a December rate hike.
Match Group, owner of dating sites Tinder and OKCupid, plans to raise as much as $466.2 million in its upcoming initial public offering. The company disclosed on Monday that its float of 33.3 million shares will be priced at between $12 and $14.
Plum Creek Timber (PCL) shares jumped more than 16% after Weyerhaeuser (WY) - Get Report agreed to buy the company in a deal that would create a $23 billion timber company. Weyerhaeuser's Doyle Williams will act as president and CEO of the new company.
Apache (APA) - Get Report rose 10% after Bloomberg reported the oil and gas producer received, and rejected, an unsolicited takeover approach. The Houston-based oiler is reportedly working with Goldman Sachs to draft a defense.
Cisco (CSCO) - Get Report announced it has teamed up with Ericsson (ERIC) - Get Report , the world's largest networks company. The partnership is expected to generate more than $1 billion in revenue for each company by the end of 2018.
Sotheby's (BID) - Get Report beat analysts' estimates in its third quarter. The auction house reported a net loss of 26 cents a share, a penny narrower than expected, while revenue rocketed 47% higher to $137.99 million. Sotheby's said it suffered weaker sales in profitable categories such as jewelry and paintings which led to lower commission revenue.
Dean Foods (DF) - Get Report jumped 4% after beating third-quarter profit estimates maintained high prices even as the costs of raw milk declined. The largest U.S. milk process earned an adjusted 30 cents a share over the quarter, 6 cents above estimates. However, revenue dropped 14% to $2.03 billion, marking the third straight sales decline.
Hertz Global (HTZ) - Get Report slipped after missing profit and sales estimates in the third quarter. The car-rental company earned an adjusted 49 cents a share, 3 cents below consensus. Sales fell 1.6% in its domestic car-rental unit and 13.6% internationally.
Dish Network (DISH) - Get Report was slightly lower after subscriber losses deepened. The pay-TV provider said subscribers fell by 23,000 in its third quarter compared with 12,000 a year earlier. However, quarterly profit of 42 cents a share managed to beat estimates by 3 cents.
Anavex Life Sciences (AVXL) - Get Report climbed 4.5% after the biopharma reported positive results from its clinical trial of an Alzheimer's Disease treatment. However, some argue that the trial results have been misleadingly overblown.