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Rite Aid Confirms $2.55 B Deal
Aug 24, 4:39 PM EDT |
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| Rite Aid confirmed the purchase of two competing store chains for $2.55 billion. The drug retailing industry has been rapidly consolidating. |
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| Rite Aid confirmed the purchase of Eckerd and Brooks drug store chains from Jean Coutu Group for $2.55 billion and assume debt of $850 million. the combned company will be the third largest drug store chain only to trail CVS and walgreen. The fast consolidating drug store industry has come to be dominated by two battling leaders CVS and Walgreen and discount stores such as Wal-Mart and Costco. |
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Retail Stocks Lead Averages Lower
Aug 24, 4:02 PM EDT |
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| Market averages traded near unchanged level with light trading volume. Negative sentiment in the trading circles prevailed. |
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| Three economic reports, earnings disappointment in retail stocks and light trading on both exchanges did not help market averages. Jobless claims fell by 1,000 at the end of the last week, July durable goods orders fell 2.4% and new home sales declined. It was the new home sales report that hurt the market sentiment the most. Home sales declined 4.3% from June and 21.6% from a year ago. Chicos reported 10% higher earnings but same-store sales at core group of stores fell. Stock fell 25%. |
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Cement, German GDP and Italian Banks
Aug 24, 2:32 PM EDT |
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| Cement stocks in Switzerland, German GDP report and talk of Italian banking stocks dominated European trading. Markets in the region closed higher. |
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| European markets closed higher led by a rise in Germany, France, Spain and Switzerland. Banking merger talks between two large banks in Italy, Banca Intensa and Saopaolo IMI, led banking stocks in Milan higher. German GDP report showed healthly gain on domestic investment. Cement maker Holcim reported 38% jump in sales and 30% rise in earnings on acquisition and price hike. swiss watch maker Swatch reported better earnings. |
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Chicos Drops 25%
Aug 24, 1:20 PM EDT |
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| Chicos reported rise of 10% in second quarter earnings to 30 cents from 27 cents a year ago. Same-store sales at the flagship stores Chicos rose 3%. |
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| Retail stocks traded lower after three hours of trading. Chicos suffered 25% decline on the earnings news. The company reported 30 cents vs 27 cents a year ago on revenue rise of 18%. The same-store sales at Chicos flagship store rose only 3%, lower than the double-digit growth that the chain is used to generate for the last nine years in a row. Chicos is down 25% today and down 60% from its peak of $49 in February. |
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Toro Drops 7% On Earnings
Aug 24, 11:50 AM EDT |
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| Market averages remained subdued after the release of new home sales. Toro reported earnigs of 91 cents vs. 74 cents a year ago. |
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| Market averages remained subdued after the release of three economic reports. Durable orders declined 2.4%, new home sales declined 21.6% from a year ago and jobless claims fell by 1,000 in the last week to 313,000. Averages tried several comeback but failed to make a mark. Retail stocks are on the decline afte the earnings revision from Toro and Chicos. |
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Sensex Rises on Rate Stability
Aug 24, 10:31 AM EDT |
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| After a weak start, the market spurted in late trading on a rise in bond prices and hopes of steady domestic fuel prices. |
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| The Sensex on BSE staged a solid intra-day rebound after spending most of the day in negative territory on weak Asian markets. Supported by a rise in the bond prices to a two-month high, as well as buoyed by hopes that domestic fuel prices may not increase in the near term. Reliance Industries led the advancers in afternoon trading. Metal, cement, auto, banking, IT and construction shares advanced. |
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Mild Gains, Light Volume
Aug 24, 9:57 AM EDT |
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| Early trading indicated a positive bias at the market opening. Three popular averages are in the plus column after twenty minutes of trading. |
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| Market averages gained on the report of durable goods orders and jobless claims. Three popular averages rose on the hope that the Fed may not raise interest rates at the next meeting. Rite Aid is in a deal to buy Eckerd drug store chain for $2.55 billion. Chicos dropped 21% on earnings. Toro dropped 4% on earnings. Benihana traded up 5%. European exchanges are up between 0.6% and 1.2% up. |
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Futures Indicate Higher Opening
Aug 24, 9:27 AM EDT |
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| Rite Aid is in a deal to aquire Eckerd and Brooks stores. Futures trading indicate Nasdaq to open up 4 points and Dow to open up 9 points. |
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| Futures market indicate higher opening on the back of durable goods order and jobless claims report. July durable goods orders fell 2.4% but the orders excluding transportation gaied 0.5%. Jobless claims for the last week fell 1,000 to 313,000. Rite Aid is in a deal to acquire Eckerd drug store chain for for $1.45 billion in cash and 250 million shares totaling $2.55 billion purchase price. |
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Exporters In Tokyo Lead Decline in Asia
Aug 24, 7:33 AM EDT |
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| Asian stocks finished mostly lower Thursday, as blue-chips Sony and Toyota Motor followed U.S. markets down. |
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| Japanese shares fell for a second straight session as unimpressive U.S. housing sales and inventories data made investors sell Japanese equities. Large-cap exporters in the auto and tech sectors led the decliners on revived fears of a slowdown in U.S. consumer demand. In Hong Kong, shares dropped on concerns about slowing global growth and disappointing results from some large-cap companies. All other markets fell, with only China bucking the trend. |
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German GDP Report Lifts Europe
Aug 24, 6:37 AM EDT |
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| Strong data from German Ifo, together with firm German GDP growth numbers lifted European stocks and helped Frankfurt index recover earlier losses. |
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| German Ifo business sentiment declined for a second month in August, but the data were not as bad as expected. Meanwhile, second-quarter GDP growth was confirmed at 0.9%, up from 0.7% in the first quarter. These figures reverberated across European markets and sent Frankfurt Xetra Dax up 0.5%. In Paris, the CAC 40 added 0.3% and only in London the FTSE 100 was flat. |
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