Closing Bell: Despite Mergers, Stocks Decline Ahead of Fed Meeting

×
Despite mergers, stocks decline ahead of Fed meeting
Richard Drew/APSpecialist Edward Zelles, left, works at the post that handles Elan Corp. on the floor of the New York Stock Exchange on Monday. U.S. drugmaker Perrigo agreed Monday to buy Ireland's Elan for $8.6 billion in a deal that should allow the rapidly growing company to reduce its tax bill and boost its royalty stream.
A big week for economic news began on Monday, and stocks fell ahead of a Federal Reserve meeting and what's expected to be unexciting data on growth and jobs.

The Dow Jones industrial average (^DJI) lost 35.79 points, or 0.23 percent, to close at 15,523.04. The Standard & Poor's 500 index (^GSPC) was down 6.21 points, or 0.37 percent, to 1,685.44. The Nasdaq composite (^IXIC) declined 14.02 points, or 0.39 percent, to 3,599.14.

In the day's major data release, the National Association of Realtors said that its seasonally adjusted index for pending home sales slipped 0.4 percent to 110.9 in June. That's down from a 6.5 year high in the previous month -- May's revised reading was lower by a percentage point (111.3), but remained the highest since December 2006. The new number was well-received by economists, who considered it a slight decline in the face of higher mortgage rates.

The first estimate of second quarter economic growth is released on Wednesday, and is expected to come in low, at around 0.5 percent. Also on Wednesday, the Fed will speak to investors after concluding a two-day meeting about the future of monetary policy.

There were three big-ticket mergers today:
  • Luxury retailer Saks (SKS) jumped 64 cents, or 4.18 percent, to $15.95 after announcing a $2.4 billion deal to be acquired by Hudson's Bay, the Canadian owner of Lord & Taylor.
  • Omnicom lost 36 cents, or 0.55 percent, after agreeing to merge with France's Publicis Groupe to form the biggest advertising company in the world. Shares of Omnicom jumped on the news before retreating, and the stock ended regular trading at $64.75. Rival advertising company Interpublic Group (IPG) gained 74 cents, or 4.66 percent, to end at $16.61.
  • And Perrigo (PRGO) fell $9.06, or 6.75 percent, to $125.17 after the drugmaker agreed to buy Irish biotech firm Elan for $8.6 billion. The decision reportedly had more to do with favorable tax rates in Ireland than with any of Elan's discoveries.
More stocks in the news:
  • Caterpillar (CAT) rose 1.17 percent after announcing a $1 billion accelerated stock repurchase program. Shares ended the day at $83.02, up 96 cents.
  • Caesars Entertainment (CZR) posted a smaller loss for its fiscal first quarter, but results were still short of expectations as the company's casinos drew fewer gamblers. Its net loss was $212.2 million, or $1.69 per share, down from $241/7 million, or $1.93 a share, last year. Shares were up 10 cents, or 0.65 percent, to $15.58 at closing.
  • CF Industries (CF) soared $21.30, or 12 percent, to $202.30 after reports that activist investor Daniel Loeb's hedge fund, Third Point, had invested in the company.
What to watch Tuesday
  • The S&P Case-Shiller index of home prices in 20 U.S. cities is out at 9 a.m. Eastern time.
  • The Conference Board releases its consumer confidence index at 10 a.m.
There are lots of corporate earnings tomorrow. Companies scheduled to report include:

(before market open)
  • 3D Systems Corp (DDD)
  • Aetna (AET)
  • Barclays PLC (BCS)
  • Coach (COH)
  • Deutsche Bank AG (DB)
  • The Goodyear Tire & Rubber Company (GT)
  • JetBlue Airways (JBLU)
  • Martha Stewart Living Omnimedia (MSO)
  • Merk (MRK)
  • Nielsen Holdings (NLSN)
  • NYSE Euronext (NYX)
  • Occidental Petroleum (OXY)
  • Office Depot (ODP)
  • Oshkosh (OSK)
  • Pfizer (PFE)
  • Sprint Nextel (S)
  • United States Steel (X)
  • Waste Management (WM)
  • Western Union (WU)
(after market close)
  • Aflac (AFL)
  • Amgen (AMGN)
  • Buffalo Wild WIngs (BWLD)
  • Cloud Peak Energy (CLD)
  • Dynamic Materials (BOOM)
  • NuVasive (NUVA)
  • Grand Canyon Education (LOPE)
–Compiled from staff and wire reports

Increase your money and finance knowledge from home

Forex for Beginners

Learn about trading currencies and foreign exchange transactions

View Course »

What Is Your Risk Tolerance?

Answer the question "What type of investor am I?".

View Course »

Add a Comment

*0 / 3000 Character Maximum

4 Comments

Filter by:
Bill

In the stock market, every day seems to be opposite day. When an article like this is printed, everyone expects stocks to take a hit the very same day. I predict that they will go up today (wishful thinking?)

July 30 2013 at 6:28 AM Report abuse rate up rate down Reply
jncstoafer

Why would anyone worry about the Fed announcements, or any of the great things for that matter that our Executive, Legislative or the supremely well managed Judicial might want to bring to our attention. Oh yeah, even the Judicial branch who is force-fed by Congress and disabled by an Executive who can see the errant ways but will not act. Start somewhere. See Erin Fuchs latest on Mandatory Minimums in Business Insider 07/29/2013, another Black Hole for the government to throw money into.

July 29 2013 at 10:55 PM Report abuse +1 rate up rate down Reply
amani4000

Huh, nothing said about the Huge loss in Japan's markets being a cause of caution today. China lost a little as well. The kick the can game with our economy is just about over. High oil for nothing but profit taking , again. The drains on the middle class wallets is beginning to be felt, again. Best hold on tight cause the future of an economy built on credit, not goods and services, is not a real good future at all. Our current economy is a Ponzi scheme, brought to us by the Fed. and big banks.The end of this Ponzi will make the great depression look like a holiday. People had more respect for each other back then.

July 29 2013 at 8:01 PM Report abuse +1 rate up rate down Reply
worried man

Hmmmm 80% of the middle class faces poverty and unemployment.....what me worry

July 29 2013 at 7:14 PM Report abuse +2 rate up rate down Reply
worried man

it may be time for profit taking

July 29 2013 at 7:14 PM Report abuse +2 rate up rate down Reply
jdykbpl45

Wait until after the meeting!

July 29 2013 at 6:16 PM Report abuse +3 rate up rate down Reply