On The Fly: Top stock stories for Tuesday
Stocks spent nearly the entire session, except for a few minutes after the open, in the red. There was little in the way of a catalyst as the day's economic data points, including reports on housing prices and consumer confidence, had little effect on the market. Oil prices were higher early in the session on concern of hurricane activity in the Gulf of Mexico, but the commodity still ended with a loss of about 1% amid continuing supply and demand concerns. ECONOMIC EVENTS: In the U.S., the Case/Shiller 20-City home price index showed prices rose 5.1% in June from the same period a year ago. The Conference Board's consumer confidence index for August jumped to an 11-month high of 101.1. COMPANY NEWS: Shares of Apple (AAPL) slipped 0.8% to $106 per share after the iPhone maker was ordered by the EU to pay $14.5B in back taxes after European regulators concluded that Ireland gave the tech giant illegal tax benefits. Commenting on the decision, Piper Jaffray analyst Gene Munster said he does not expect investors to punish the stock. JPMorgan analyst Rod Hall goes even further, saying that he sees this tax ruling as a positive given the lack of impact on the company's going forward tax rate. For its part, Apple stated that Ireland has said they plan to appeal the Commission's ruling and that the company will do the same, adding that it is "confident that the Commission's order will be reversed"... Shares of Hershey (HSY) plunged 10.8% after Mondelez (MDLZ) announced that it had terminated talks about a potential merger of the two companies. Multiple media reports indicated that Mondelez had raised its bid for Hershey to $115 per share last week, but that the latter said that price discussions would need to begin at $125 per share, leading Mondelez to abandon its takeover efforts. Mondelez shares rose about 4% following the announcement... Potash Corporation (POT) and Agrium (AGU) confirmed they are in talks to merge after Bloomberg reported the same, citing people familiar with the matter. Both Potash Corp. and Agrium cautioned that "no decision has been made as to whether to proceed with such a combination, no agreement has been reached, and there can be no assurance that any transaction will result" from their talks, but shares of both agricultural product producers spiked following the news, with Potash shares advancing 12% and Agrium rising 7%. MAJOR MOVERS: Among the notable gainers was Ritchie Bros. (RBA), which gained 23.6% after announcing an agreement to acquire IronPlanet, an online marketplace for used heavy equipment and other durable asset sales, for approximately $758.5M. The company also announced its entry into a strategic alliance with Caterpillar (CAT) that will see Ritchie Bros. become Caterpillar's preferred global partner for live onsite and online auctions. Also higher was United Continental (UAL), which gained 8.6% after the airline named the president of American Airlines (AAL) as its new company president. American shares also rose 2.4% amid strength in the broader airline sector. Among the noteworthy losers was Abercrombie & Fitch (ANF), which fell 20% after the apparel retailer reported quarterly losses that were worse than expected and said it now expects comparable sales to remain challenging through the second half of the year, with a disproportionate effect from flagship and tourist locations. Also lower were shares of G-III Apparel (GIII), which also fell about 20% after the owner of apparel brands such as Calvin Klein and Tommy Hilfiger posted quarterly results that missed expectations and lowered its guidance for the year. INDEXES: The Dow dropped 48.69, or 0.26%, to 18,454.30, the Nasdaq lost 9.34, or 0.18%, to 5,222.99, and the S&P 500 slipped 4.26, or 0.2%, to 2,176.12.