Mid-Afternoon Market Update: Tempur Sealy Drops After Loss Of Mattress Firm Contract; Digital Ally Shares Surge

Toward the end of trading Monday, the Dow traded down 0.92 percent to 19,908.26 while the NASDAQ declined 1.08 percent to 5,599.68. The S&P also fell, dropping 0.96 percent to 2,272.76.

Leading and Lagging Sectors

Non-cyclical consumer goods & services shares slipped by just 0.18 percent in trading on Monday.

In trading on Monday, energy shares tumbled by 1.86 percent. Meanwhile, top losers in the sector included Tidewater Inc. TDW, down 11 percent, and Enbridge Energy Partners, L.P. EEP, down 9 percent.

Top Headline

Booz Allen Hamilton Holding Corporation BAH reported weaker-than-expected earnings for its third quarter.

Booz Allen reported Q3 adjusted earnings of $0.38 per share on revenue of $1.4 billion. Analysts were expecting earnings of $0.40 per share on revenue of $1.37 billion.

Booz Allen also raised its quarterly dividend from $0.15 per share to $0.17 per share.

Equities Trading UP

Calithera Biosciences Inc CALA shares shot up 47 percent to $6.78. Incyte Corporation INCY and Calithera Biosciences reported a global collaboration for the development and commercialization of CB-1158.

Shares of Eyegate Pharmaceuticals Inc EYEG got a boost, shooting up 12 percent to $1.83 after the company reported positive top-line data from first-in-human pilot trial of Ocular Bandage Gel in corneal epithelial defects.

Digital Ally, Inc. DGLY shares were also up, gaining 15 percent to $5.40. Digital Ally disclosed that it was awarded its largest commercial order in its history from American Medical Response. The deal has a potential value of $8.3 million over a three-year deployment.

Equities Trading DOWN

Ocera Therapeutics Inc OCRX shares dropped 71 percent to $0.600 after the company reported top-line results for Phase 2b study in Hepatic Encephalopathy.

Shares of Regulus Therapeutics Inc RGLS were down around 49 percent to $1.15 after the company received a written communication from the U.S. Food and Drug Administration that the clinical development for the company's RG-101 remains on clinical hold.

Tempur Sealy International Inc TPX was down, falling around 28 percent to $45.32 following the announcement that Mattress Firm Holding Corp MFRM has terminated all contracts with the company as of January 27. SunTrust Robinson Humphrey downgraded Tempur Sealy from Hold to Sell, while Stifel Nicolaus downgraded the stock from Buy to Hold. Piper Jaffray also downgraded the stock from Overweight to Neutral.

Commodities

In commodity news, oil traded down 0.75 percent to $52.77 while gold traded up 0.46 percent to $1,196.60.

Silver traded down 0.09 percent Monday to $17.12, while copper fell 1 percent to $2.66.

Eurozone

European shares closed lower today. The eurozone’s STOXX 600 dropped 1.05 percent, the Spanish Ibex Index fell 1.50 percent, while Italy’s FTSE MIB Index declined 2.95 percent. Meanwhile the German DAX slipped 1.12 percent, and the French CAC 40 declined 1.14 percent while U.K. shares fell 0.92 percent.

Economics

U.S. consumer spending rose 0.5 percent for December, matching economists’ expectations for a 0.5 percent growth. Personal income increased 0.30 percent last month, versus estimates of 0.40 percent gain.

The pending home sales index rose 1.6 percent to 109 in December. Economists were expecting a 1.1 percent growth.

The Dallas Fed manufacturing business index rose to 22.10 in January, versus a revised reading of 17.70 in the previous month. Economists projected a reading of 15.00.