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Despite an upward revision to the latest U.S. gross domestic product number from 2.8% to 3.6%, meaning the economy is growing faster than previously believed, two major indexes are in the red at this time. As of 1:07 p.m. EST, the Dow Jones Industrial Average was lower by 25 points, or 0.16%, the S&P 500 was off by 0.18%, and the Nasdaq was up by 0.04%. Some believe that a better GDP number could lead the Federal Reserve to cut interest rates sooner than expected, which would be bad for stocks in the short term and may explain some of today's losses. However, not all of today's losers can be blamed on the Fed, so let's take a look at a few which are moving based on their own issues.
Shares of the supermarket chain Safeway are down 3.16% today. The decline comes after activist investor Jana Partners reported it had cut its stake in the grocer from 6.2% to 4.1%. When Jana opened the position it wanted the company to reduce its store count and provide more capital return to investors. Safeway has since announced that it will leave the Chicago market and sell its 72 Dominick's grocery stores. Safeway's stock is up more than 20% since Jana opened it position in September, so the fact that it is cutting the position shouldn't be too much of a surprise.
Another retailer, Rite Aid is also having a rough day, with shares down 4.1%. The drop comes after the company reported same-store sales for November that actually increased by 2.8%. But that is clearly not enough growth to make investors happy. The front end of the store increased sales by 0.4%, while the pharmacy increased by 3.9%. Furthermore, Rite Aid reported sales of $6.33 billion for the third quarter, while analysts had expected $6.3 billion and the company reported $6.21 billion during the same time frame in 2012. Although the company is certainly growing, it is just very slow growth and not what investors were hoping for.
Lastly, shares of Clear Channel Outdoor are trading lower by 6.93% after the stock was downgraded at B. Riley. The previous stock rating of neutral was lowered to a sell rating. The rating change comes as the company looks to push back the maturity dates on some of its bonds amid a cash flow problem. Management continues to attempt to turn around a business that has not been profitable since 2008; it believes that asking for more time to pay off this debt will help get the company moving again. However, asking to push back the debt does increase the likelihood that the company may eventually default, and this will likely increase Clear Channel's borrowing costs in the future.
More Foolish insight
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The article Higher GDP Number, Lower Stock Prices originally appeared on Fool.com.Fool contributor Matt Thalman has no position in any stocks mentioned. Check back Monday through Friday as Matt explains what causing the big market movers of the day, and every Saturday for a weekly recap. Follow Matt on Twitter @mthalman5513 . The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.