Mid-Morning Market Update: Markets Open Lower; PepsiCo Earnings Beat Expectations

Following the market opening Tuesday, the Dow traded down 0.55 percent to 24,466.68 while the NASDAQ declined 0.34 percent to 6,958.39. The S&P also fell, dropping 0.50 percent to 2,642.84.

Leading and Lagging Sectors

Tuesday morning, the basic materials shares climbed 0.24 percent. Meanwhile, top gainers in the sector included Martin Marietta Materials, Inc. MLM, up 8 percent, and AptarGroup, Inc. ATR, up 7 percent.

In trading on Tuesday, telecommunications services shares tumbled 0.91 percent. Meanwhile, top losers in the sector included Telecom Italia SpA (ADR) TI, down 3 percent, and Cincinnati Bell Inc. CBB down 3 percent.

Top Headline

PepsiCo, Inc. PEP reported better-than-expected earnings for its fourth quarter.

The company said it earned $1.31 per share on revenue of $19.53 billion in the fourth quarter. However, Wall Street analysts were expecting the company to earn $1.30 per share on revenue of $19.39 billion.

PepsiCo raised its annual dividend from $3.22 per share to $3.71 per share and announced a $15 billion buyback program. PepsiCo expects FY 2018 adjusted earnings of $5.70 per share, versus analysts’ estimates of $5.67 per share.

Equities Trading UP

GNC Holdings Inc GNC shares shot up 22 percent to $5.12 following announcement of $300 million investment from Harbin Pharmaceuticals. GNC reported in-line quarterly earnings.

Shares of WMIH Corp. WMIH got a boost, shooting up 58 percent to $1.26. The insurance company agreed to merge with Nationstar Mortgage Holdings Inc NSM. Nationstar shareholders could chose to receive $18.00 in cash or 12.7793 of WMIH common stock for each share owned. Nationstar shareholders will own around 36 percent of the combined entity with WMIH shareholders owning the remaining 64 percent.

On Deck Capital Inc ONDK shares were also up, gaining 11 percent to $4.99 following upbeat quarterly results.

Equities Trading DOWN

Dare Bioscience Inc DARE shares dropped 41 percent to $1.66. Dare Bioscience priced 5 million common share and warrants to buy up to 3.5 million common shares at $3 per share.

Shares of Helios and Matheson Analytics Inc HMNY were down 30 percent to $5.60 after the company reported pricing of its $105 million public offering.

InVitae Corp NVTA was down, falling around 8 percent to $5.82 after the company posted a wider-than-expected Q4 loss.

Commodities

In commodity news, oil traded down 0.69 percent to $58.88 while gold traded up 0.20 percent to $1,329.00.

Silver traded down 0.15 percent Tuesday to $16.545, while copper rose 1.25 percent to $3.125.

Eurozone

European shares were mostly lower today. The eurozone’s STOXX 600 declined 0.02 percent, the Spanish Ibex Index fell 0.49 percent, while Italy’s FTSE MIB Index dipped 0.76 percent. Meanwhile the German DAX dropped 0.05 percent, and the French CAC 40 fell 0.05 percent while U.K. shares rose 0.34 percent.

Economics

The NFIB small business optimism index gained 2 points to a reading of 106.9 in January. However, economists were expecting a reading of 105.5.

The Johnson Redbook Retail Sales Index dropped 1.1 percent during the first week of February versus January.

The Treasury is set to auction 4-week bills at 11:30 a.m. ET.