Stocks continue to act well as we had a few days of consolidation to begin this week and today another attempt at yearly highs. Today that attempt was successful with a close above earlier year highs; as we said the past few days what was happening with the failures at a key level was not necessarily bearish especially with such a sharp rally to get to that point. The S&P 500 gained 0.49% and the NASDAQ 0.63%. The upper purple trend line continues to be a likely eventual destination for the NASDAQ! New Federal Reserve head Janet Yellen spoke today and said nothing to spook the market, so it was all systems go:
Testifying before the Senate Banking Committee, Yellen said the Fed would watch carefully to make sure weather was indeed behind the recent weakness. But she said it would take a “significant change” to the economy’s prospects for the central bank to put plans to reduce its bond-buying program on hold.
In economic news:
Durable goods data was better than expected, with orders—excluding transportation—up 1.1 percent, the largest increase since May, after December’s drop of 1.9 percent.
Indexes act fine.
Retailers were in the news again. J.C. Penney (JCP) shares surged, a day after the U.S. department store chain forecast more improvement in its comparable sales and gross profit margin this fiscal year. This has been a very troubled company but shows the danger of pressing a position (in this case – short) around earnings!
We highlighted Zulily (ZU) earlier this week on earnings – it took off again today.
Sears Holding Corp (SHLD) reported a quarterly loss that narrowed from the year-ago period, sending its stock up. Not a nice chart but a name often in the news.
Shares of Deckers Outdoor (DECK) tumbled 13% to the $73s in after hours after the company, whose brands include UGG boots and Teva sandals, posted earnings. The guidance was poor:
The company projected a loss of 16 cents a share for the current quarter. Analysts had estimated a profit of 10 cents on average, according to data compiled by Bloomberg. The operating expenses of opening 28 additional stores is weighing on profit, the company said in a statement. Revenue also will grow 6 percent in the period, Deckers said. That was half the 12 percent rate that analysts predicted.
In the fourth quarter, Deckers reported a 44 percent jump in net income to $140.9 million, or $4.04 share, from $98.1 million, or $2.77, a year earlier. Revenue advanced 19 percent to $736 million.