While you were sleeping: Sears teams up with Amazon
By Margreet Dietz
July 21 (BusinessDesk) - Wall Street was mixed as a rally in shares of Sears following its deal with Amazon offset slides in other retailers including Home Depot, Lowe’s and Best Buy.
Shares of Sears jumped, up 10.6 percent as of 3.45pm in New York, after the embattled retailer said it agreed to start selling its Kenmore products on Amazon.com.
"The launch of Kenmore products on Amazon.com will significantly expand the distribution and availability of the Kenmore brand in the US,” Edward Lampert, chief executive officer of Sears, said in a statement.
Sears also announced the integrations of Kenmore Smart appliances with Amazon Alexa.
“The Kenmore Smart skill for Amazon Alexa enables customers to control their Kenmore Smart home appliances by simply asking Alexa, such as changing the temperature on their air conditioner without leaving the sofa,” Sears said in a statement.
In 3.44pm trading in New York, the Dow Jones Industrial Average inched 0.03 percent lower. However, the Nasdaq Composite Index rose 0.13 percent. In 3.29pm trading, the Standard & Poor’s 500 Index gained 0.1 percent.
Earlier in the day, the S&P 500 climbed to a record 2,477.62, while the Nasdaq rose to a record high 6,398.26.
"Earnings are going to surprise to the upside and so far it's been good," Brent Schutte, chief investment strategist for Northwestern Mutual Wealth Management Company, told Reuters.
"I think the one thing that's changed is now we're getting revenue growth because in many cases the world is doing better,” Schutte noted. “That's the big change to the economy over the past year and that's what will keep the fire burning in the future."
In the Dow, slides in shares of Home Depot and those of Travelers, recently down 4 percent and 1.5 percent respectively, offset gains in shares of Nike and those of Verizon, recently up 2.3 percent and 2 percent respectively.
In Europe, the Stoxx 600 Index finished the session with a decline of 0.4 percent from the previous close. Germany’s DAX Index slipped 0.04 percent, while France’s CAC40 Index fell 0.3 percent.
The UK’s FTSE 100 Index rose 0.8 percent.
Following a European Central Bank President policy meeting at which it made no changes to its key interest rates and asset purchase program, President Mario Draghi flagged that the Governing Council would begin discussing changes to the program in the fall.
“We also were unanimous in communicating no change to the forward guidance; and also we were unanimous in setting no precise date for when to discuss changes in the future," Draghi told a press conference in Frankfurt, Germany. “In other words, we simply said that our discussions should take place in the fall—or in the autumn, since we are in Europe."
The euro strengthened.
“A fairly dovish Mario Draghi failed to keep the euro bulls fully contained,” Neil Wilson, a market analyst at ETX Capital, wrote in a note, according to Bloomberg. “What he did let slip is that the Governing Council is likely to discuss tapering in the autumn.”
Meanwhile, Unilever shares climbed after the Anglo-Dutch consumer goods company upgraded its outlook for full-year profitability.
The company now expects an improvement in underlying operating margin this year of at least 100 basis points and strong cash flow, Unilever Chief Executive Officer Paul Polman said in a statement. That’s up from an April forecast for an increase of at least 80 basis points.
“Our first half results show continued growth well ahead of our markets and a substantial step-up in profitability despite the persisting volatile global trading environment," Polman said. "The transformation of Unilever into a more resilient, more competitive and more profitable business is accelerating.”
Shares of Unilever, which earlier this share rebuffed a takeover bid by Kraft Heinz, closed 1.7 percent higher in London.
"Unilever know they cannot relax and investors expect them to raise their game," Steve Clayton, fund manager at Hargreaves Lansdown Select, whose funds are 5 percent invested in Unilever, told Reuters.