Here Are 3 Hot Things to Know About Stocks Right Now
- Stocks turned turned sharply lower in late trading to end the day lower after a decision from the Federal Reserve to raise interest rates.
- The S&P 500
has closed down for four consecutive days.
- Nike Inc. (NKE) fell 01.2% after sales growth and a decline in margins at the athletic apparel retailer disappointed analysts.
Wall Street Overview
Stocks fell in late trading to end the day lower Wednesday after the Federal Reserve boosted interest rates by 25 basis points, marking the central bank's third tightening of 2018.
The Dow Jones Industrial Average and other key indices gave up earlier gains ahead of the widely expected rate hike.
The Dow Industrials
TheStreet's Bradley Keoun writes that investors have been wondering how many more increases in borrowing costs the U.S. economy can handle. The answer: Not many.
Elsewhere on Wall Street, shoe giant Nike Inc. (NKE) fell 1.2% even as fiscal first-quarter earnings of 67 cents a share beat analysts' estimates by 5 cents. However, NKE's 10% sales growth disappointed investors. Revenue in the quarter was $9.9 billion, matching forecasts. "Ten percent revenue growth ... it really needed to be a little bit more than that," Stacey Widlitz, president of consulting firm SW Retail Advisors, told CNBC.
Nike's gross margins also were a sour spot for analysts. Gross margins rose by 60 basis points to 44.2%, but came in below forecasts of 44.3%.
UBS IT hardware analyst Steven Milunovich raised his price target on the stock to $180 from $160, firmly ahead of analyst consensus estimates of $167. UBS noted that while there was "little chance" of revenue growth for IBM Analytics, Cloud and Services in 2019, the following year looks better, and will be driven by "Cloud and Analytics."
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Among other movers, Carmax Inc. (KMX) posted fiscal second-quarter earnings of $1.24 a share, 2 cents ahead of estimates, while same-store used unit sales rose 2.1%, also ahead of forecasts. However, the stock declined 1.6%.
Similarly, KB Home (KBH) shed 3% even as the homebuilder posted third-quarter earnings of 87 cents a share, 10 cents above analysts' expectations.
Conversely, Dunkin' Brands (DNKN) roseslightly, up 0.3%, after the chain announced plans to drop the word "Donuts" from its "Dunkin' Donuts" name.
"The simplicity of our new branding creates energy," CEO David Hoffmann told reporters Tuesday on a conference call announcing the change. "Dunkin' no longer wants to be known as primarily a doughnut chain, but rather a coffee chain, which goes along with the company's need for speed. It also speaks to the breadth of our product offerings." However, stores will still actually sell doughnuts.
Lastly, Papa John's International Inc. (PZZA) rose 8.5% after CNBC reported that John Schnatter, the ousted founder of the pizza chain, has reached out to a number of private-equity firms in recent weeks to discuss partnering in a bid to buy the company.
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