Jim Cramer: McDonald's Results 'Blew Me Away' But Not in a Good Way
Jim Cramer: McDonald's Results 'Blew Me Away' But Not in a Good Way
Aetna Shares Weigh on S&P 500; Stocks Close Lower on Greece Uncertainty
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The major U.S. markets moved higher at midday on Tuesday powered by positive economic data and a flood of big names reporting earnings. On the economic front, consumer prices gained in June, mainly due to higher gas prices. Existing home sales rose for a third straight month in June. Homebuilder stocks like Toll Brothers (TOL), Lennar (LEN) and D.R. Horton (DHI) are all trading higher following the release of the housing sales data. A slew of companies reported results before the opening bell including results from Chipotle Mexican Grill (CMG) that far exceeded Wall Street's expectations. Shares of Chipotle are being generously rewarded in Tuesday's session, gaining 10%. McDonald's (MCD) shares are adding to their decline after reporting earnings that missed estimates. Jim Cramer says the numbers surprised him and he isn't a fan of the stock. After the bell, investors are waiting for Apple (APPL) and Microsoft (MSFT) to report. TheStreet's Susannah Lee reports from Wall Street.
U.S. stocks survived Greece's 'no' vote with only minor losses Monday, but oil prices weren't so lucky. All three major stock indexes closed lower, but the real turmoil was found in the commodities market. The drama in Greece fanned fears of lower global economic growth, which sent oil prices sharply lower by 7.4 percent to $52.74 a barrel. The looming Tuesday deadline for nuclear negotiations with Iran also put downward pressure on prices. This sent shares of energy stocks lower. Transocean (RIG) fell 4.2 percent. About 61 percent of voters in Greece rejected a bailout package demanded by Greece's European creditors and the International Monetary Fund. The 'no' vote on Sunday leaves the possibility of a 'Grexit' wide open, as experts said Greek banks have just days of liquidity remaining. A 'Grexit' would mean a return to the drachma for Greece or the creation of an alternative currency. Meanwhile, health insurance giant Aetna (AET) agreed to purchase Humana (HUM) in a deal announced Friday for roughly $230 a share, or $27 billion. Aetna was the worst performing stock in the S&P 500. Shares dipped almost 7 percent.
Stocks gave up some of their gains after Greece Prime Minister Alexis Tsipras told citizens to vote 'no' in its July 5 referendum. Tsipras' speech on Wednesday urged citizens to vote against spending cuts in its referendum on July 5. He denied the referendum is a vote about exiting the eurozone and said a 'no' vote will give him more leverage in negotiations with creditors. The Prime Minister also said he remains at the negotiating table and is 'fighting to protect people's pensions.' But Greece's creditors may not be open to budging on pensions, which could increase Greece's deficit. Meanwhile, crude prices slipped over 2.5 percent on Greece worries, trading at $57.96. Plus, Macy's (M) said its ending its relationship with Republican presidential candidate Donald Trump following controversial comments the billionaire real estate mogul made about Mexico. Macy's sells Trump-branded menswear. Shares rose just slightly. TheStreet's Scott Gamm reports from New York.
Stocks were down across the board in midday trading Monday as a Greek exit from the eurozone looks more and more likely. The S&P, Dow Jones Industrial Average and Nasdaq all moved into the red after Greece voted 'no' to bailout terms from the IMF and European creditors over the weekend. Wall Street is feeling the ripple effects of the Greek debt crisis but investors are still holding out for a last minute deal. German Chancellor Angela Merkel flew to Paris on Monday for further bailout discussions. Outspoken Greek Finance Minister Yanis Varoufakis has handed in his resignation following the referendum result. His absence may allow the Greek government to compromise as creditors push for new deal terms. In the U.S., after selling 330 of its stores, discount chain Dollar Tree (DLTR) has got the green light from the Federal Trade Commission for its take over of retailer Family Dollar (FDO). The deal will be worth around $9.2 billion. Shares of Weight Watchers International (WTW) jumped around 27 percent following a report from the New York Post that an activist investor may be looking to acquire a majority stake in the company. The weight loss organization has failed to keep up with consumer fitness trends, with the stock plummeting around 84 percent in the last 12 months. Weight Watchers saw its active subscriber base drop 17 percent in the first quarter.
U.S. stocks opened lower Monday as Greece ventures into an uncertain future when voters overwhelmingly rejected austerity plans aimed at relieving the nation's crushing debt. Sales of computer and mobile chips climbed 5% in May, according to the Semiconductor Industry Association. Tesla Motors (TSLA) shares are less than 4% from their all time high set on September 4th. Shares rallied 4% after the electric car maker reported record sales. Securities regulators have launched a broad investigation into whether hedge funds and other investors are improperly selling hot private technology stocks amid a boom in the trading of such shares, according to the Wall Street Journal.
In Monday's Analysts' Actions, TheStreet highlights a coverage initiation on GoPro (GPRO) as well as a couple of positive notes on Amazon (AMZN) and Tripadvisor (TRIP). Analysts at Goldman Sachs started coverage on GoPro, the wearable action camera company, with a NEUTRAL rating and a $60 price target. The firm believes that the action camera business will commoditize. Analysts at CLSA raised their price target on Amazon, citing the possible trade into China. The firm upped its price target to $500, following a recent study on Chinese consumer trends for e-commerce that favored cross-border trade into China. And, Tripadvisor received a positive note by analysts at Barclays. The travel website operator was upgraded to EQUAL WEIGHT from UNDERWEIGHT with an increased price target of $84. TheStreet's Kurumi Fukushima reports in New York.
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