Markets Marginally Lower Ahead Of Earnings Season

U.S. stocks were slightly lower as investors digested a report by Goldman Sachs speculating that the Fed Funds rate may be increased in the third quarter of 2015, earlier than expected.

Earnings season unofficially kicks off this week with Alcoa AA reporting on Tuesday. Many Dow components will follow suit in the coming days.

Finally, on Wednesday the Federal Reserve will release its June policy session minutes.

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  • The Dow lost 0.26 percent, closing at 17,024.21.
  • The S&P 500 lost 0.39 percent, closing at 1,977.65.
  • The Nasdaq lost 0.77 percent, closing at 4,451.53.
  • Gold lost 0.08 percent, trading at $1,319.50 an ounce.
  • Oil lost 0.64 percent, trading at $103.39 a barrel.
  • Silver lost 0.51 percent, trading at $21.03 an ounce.

News of Note

June Gallop U.S. Consumer Spending fell to $91 from $98 in May.

Analysts at Goldman Sachs are forecasting the Fed will increase the Fed Funds rate in the third quarter of 2015.

Analyst Upgrades and Downgrades of Note

Analysts at Standpoint Research downgraded Abercrombie & Fitch ANF to Hold from Buy. Shares lost 1.50 percent, closing at $42.59.

Analysts at Macquarie upgraded Barclays PLC BCS to Outperform from Neutral. Shares lost 1.06 percent, closing at $14.95.

Analysts at Bank of America downgraded Bed Bath & Beyond BBBY to Underperform from Neutral. Shares lost 0.15 percent, closing at $59.26.

Analysts at FBR Capital upgraded Canadian Solar CSIQ to Outperform from Market Perform. Shares lost 3.19 percent, closing at $29.73.

Analysts at Deutsche Bank maintained a Buy rating on Freeport McMoRan FCX with a price target raised to $45 from a previous $40. Shares hit new 52-week highs of $38.90 before closing the day at $38.67, up 0.42 percent..

Analysts at Canaccord Genuity downgraded GT Advanced Technologies GTAT to Hold from Buy with a price target maintained at $20. Also, analysts at UBS also downgraded GT Advanced Technologies to Neutral from Buy with an unchanged price target of $22. Shares lost 15.60 percent, closing at $16.50.

Analysts at Piper Jaffray upgraded King Digital Entertainment KING to Overweight from Neutral with a price target raised to $28 from a previous $19. Shares lost 5.22 percent, closing at $20.72.

Analysts at Citigroup maintained a Neutral rating on Merck & Company MRK with a price target raised to $57 from a previous $44. Shares lost 1.15 percent, closing at $58.52.

Analysts at Deutsche Bank maintained a Hold rating on Newmont Mining NEM with a price target raised to $24 from a previous $23. Shares lost 1.83 percent, closing at $24.73.

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Analysts at Bank of America upgraded Williams-Sonoma WSM to Buy from Neutral. Shares hit new 52-week highs of $73.45 before closing the day at $73.04, up 0.98 percent.

Analysts at Barclays maintained an Overweight rating on Wynn Resorts WYNN with a price target lowered to $235 from a previous $240. Shares lost 1.57 percent, closing at $208.58.

Equities-Specific News of Note

Expedia EXPE has agreed to acquire Australian based Wotif.com for $660 million to expand its reach in Asia-Pacific. Separately, Expedia confirmed it is a long-term investor in Chinese based eLong LONG. Shares of Expedia lost 1.65 percent, closing at $80.85 while shares of eLong gained 0.65 percent, closing at $21.76.

After a two year test period, SodaStream SODA closed its flagship store in Brighton, England. Shares hit new 52-week lows of $32.03 before closing the day at $32.22, down 2.51 percent.

Bed Bath & Beyond BBBY approved an additional $2 billion share repurchase program expected to be completed during fiscal 2016. The company has $861 million remaining in its current repurchase authorization. Shares lost 0.15 percent, closing at $59.26.

Lions Gate LGF announced a long-term distribution deal with StudioCanal covering Austria, Germany and Hungary. Shares lost 0.69 percent, closing at $28.99.

Atmel ATML has agreed to acquire Newport Media, a maker of TV broadcast and Wi-Fi Bluetooth chips for $140 million in cash. Shares lost 2.31 percent, closing at $9.29.

Ford F reported that its sales in China rose 35 percent in the first half of 2014 to 549,256 from the same period a year ago. Shares finished the day unchanged at $17.32.

Petrobras PBR cautioned investors that it stands to miss out on $15 billion in profits through 2018 if it suspends an oil platform contract with Holland based SBM Offshore. Shares lost 0.28 percent, closing at $14.45.

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Tesla Motors TSLA confirmed it will investigate the events leading up to a stolen Tesla Model S sedan that split into two pieces and then involved in a fiery crash. Shares lost 2.87 percent, closing at $222.66.

Apache APA may be seeking a buyer for its 13 percent stake in the Wheatstone liquefied gas project for around $2.5 billion. Shares lost 0.98 percent, closing at $99.05.

Citrix CTXS has hired Brian Dye, Symantec's former head of Information Security to lead Citrix's Mobile Platforms Group. Shares of Citrix lost 0.14 percent, closing at $63.45.

PetSmart PETM confirmed it is reviewing potential changes to its structure (including returning capital to shareholders) following the disclosure that Jana Partners holds a 13.5 percent activist stake. Separately, Longview Asset Management, another stakeholder in PetSmart supports the company going private, noting that a private buyer will place a higher valuation than the trading public. Shares gained 2.48 percent, closing at $68.95.

According to Barron's, shares of Dish Network DISH could see a 20 percent upside going in to the FCC's wireless spectrum auction in November.

ACE Limited ACE has agreed to acquire the corporate P&C insurance business of Itau Unibranco ITUB for $685 million. Following the acquisition, ACE Limited will now become the largest P&C insurer in Brazil. Shares of ACE Limited gained 0.09 percent, closing at $105.20 while shares of Itau Unibranco lost 0.28 percent, closing at $14.23.

Bill Ackman's Pershing Square Capital Management proposed a list of six board of director candidates for Allergan AGN in advance of a potential special meeting. Shares lost 1.94 percent, closing at $165.85.

American Apparel APP is in talks with Standard General (who owns 43 percent of the company) to secure financing following its failure to repay $10 million in debt to Lion Capital. The company is also looking to replace members of its board. Shares gained 1.72 percent, closing at $0.88.

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Freeport McMoRan FCX has agreed to a memorandum of understanding with the Indonesian government relating to contract renegotiation. Shares hit new 52-week highs of $38.90 before closing the day at $38.67, up 0.42 percent.

According to Recode, Google GOOG plans to invest $500 million in setting up a local/same-day delivery service across the U.S. Google will partner with Whole Foods Market, Staples and others to handle warehousing. Shares of Google lost 0.42 percent, closing at $582.25.

Telefonica TEF has agreed to acquire an 11.1 percent stake in Italian based Mediasset's pay-TV business for $136 million. Shares lost 1.45 percent, closing at $17.04.

Winners of Note

BlackBerry BBRY announced it won three Red Dot Awards for its Q10, Q5 and Z30 devices. Separately, the BlackBerry plans to develop a healthcare service that will utilize mass amounts of data from medical devices to enable early detection of illnesses. The company has partnered with NantHealth, a clinical software designer that spreads across 250 hospitals and connected to 16,000 medical devices. Shares gained 5.66 percent, closing at $11.21.

Kandi Technologies KNDI has received $31.8 million in subsidies from the Chinese government after selling more than 4,000 electric vehicles over the previous year. The company also stated that it plans to introduce a local subsidy policy for new energy vehicles in the city of Hangzhou. Shares gained 6.07 percent, closing at $14.87.

Decliners of Note

Goodrich Petroleum GDP announced that it completed its its Beech Grove 94H-1 well in Louisiana, with a maximum production rate of 740 barrels of energy per day. Shares lost 9.30 percent, closing at $22.92.

Arena Pharmaceuticals' ARNA CEO Jack Lief sold 223,525 shares of Arena stock at an average price of $5.85, representing just under 40 percent of his total holdings, according to an SEC filing. Shares lost 9.42 percent, cloisng at $5.29.

Quote of the Day

"If your enemy is superior, evade him. If angry, irritate him. If equally matched, fight, and if not split and reevaluate." - Sun Tzu, The Art of War.

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Posted In: EarningsNewsEcon #sEconomicsAfter-Hours CenterMoversabercrombie & fitchAllerganAmerican ApparelapacheArena PharmaceuticalsAtmelBarclaysBarron'sBed Bath & BeyondBill AckmanBlackberryBrian Dyecanadian solarcitrixDish NetworkExpediaFed Funds RateFord ChinaFreeport McMoRanGallop U.S. Consumer SpendingGoldman SachsGoodrich PetroleumGoogleGT Advanced TechnologiesJack LiefJana PartnersKandi TechnologiesKing Digital EntertainmentLions GateLongview Asset ManagementMediassetmerckNantHealthnewmont miningNewport MediaPetrobrasPetSmartReCodeSBM OffshoreSpectrum AuctionStudiocanalSymantecTelefonicatesla motorsThe Chefs' WarehouseWheastoneWilliams-SonomaWotif.comWynn Resorts
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