Stocks opened lower as the trade talks with China finished and investors began to look toward the earnings season. Investors have grown concerned about slowing global growth, making guidance from reporting companies a key to expectations. The market saw its lows shortly after the open and then began a slow drift higher. By noon, the averages had made it back to positive ground, but they struggled to gain much upside momentum. The averages drifted throughout the afternoon, but managed to extend their rally to a fifth straight session.
ECONOMIC EVENTS: In the U.S., initial jobless claims fell 17,000 to 216,000 in the week ended January 5.
In White House news, President Donald Trump tweeted that he is cancelling his trip to Davos, Switzerland for the World Economic Forum, claiming that he is doing so because of the "Democrats intransigence on Border Security and the great importance of Safety for our Nation."
In China, December's CPI was unchanged on the month after dropping 0.3% in November, while the 12-month rate slid to a 1.9% year-over-year clip versus 2.2% in November. Meanwhile, PPI growth dipped to 0.9% year-over-year versus November's 2.7% rate.
COMPANY NEWS: Shares of Macy's (M) dropped about 18% after the company cut its guidance for fiscal 2018 in conjunction with its holiday sales report. Macy's reported this morning that its owned plus licensed same-store sales for the November/December holiday period were up 1.1%, with comparable sales on an owned basis up 0.7% for the period. In November, Macy's raised its FY18 EPS view to $4.10-$4.30 from $3.95-$4.15, saying it was on track to deliver a "strong" holiday season and fourth quarter, but this morning it took its FY18 EPS view back down to $3.95-$4.00.
Other retail stocks were also weak on the heels of Macy's guidance cut, though several notably reported better SSS growth. Target (TGT) said that its same-store sales climbed 5.7% during this past holiday season, topping growth of 3.4% a year ago and surpassing some analysts' expectations. It also announced the retirement of Chief Financial Officer Cathy Smith, in addition to other management changes. For its part, Kohl's (KSS) said it was "delighted" with its 1.2% shifted comparable sales increase for the holiday period, while L Brands (LB) reported that comparable sales were flat for the five weeks ended January 5 when compared to the same period of last year.
In other news, Ford (F) announced that it is starting consultations with its union partners and other key stakeholders to implement "a comprehensive transformation strategy" in Europe that is expected to result in "thousands" of job cuts.
Meanwhile, GameStop (GME) shares slipped fractionally after The Information reported that Amazon (AMZN) is working on a video game streaming service.
MAJOR MOVERS: Among the noteworthy gainers was Acadia (ACAD), which rose 5% after its presentation at the JPMorgan Healthcare Conference, during which it highlighted opportunities for its drug Nuplazid. Also higher was Bed Bath & Beyond (BBBY), which gained 16.5% after reporting quarterly results.
Among the notable losers was Barnes & Noble (BKS), which fell 16% after it reported holiday period comparable sales growth and said that its earnings guidance may be reduced as much as 10%. Also lower was American Airlines (AAL), which declined 4% after it cut its adjusted earnings guidance for fiscal 2018.
INDEXES: The Dow rose 122.80, or 0.51%, to 24,001.92 , the Nasdaq gained 28.99, or 0.42%, to 6,986.07 , and the S&P 500 advanced 11.68, or 0.45%, to 2,596.64 .
