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Stocks Close Narrowly Mixed As These Chinese Stocks Surge

The major indexes closed narrowly mixed Monday after they pared or entirely erased earlier losses.

The Nasdaq composite fell a fraction while the S&P 500 added 0.1%. Strength in metal stocks seemed to help the S&P 500. Volume on the Nasdaq and NYSE was lower compared with Friday's totals, based on early figures.

The Russell 2000 was down a fraction. The Dow Jones industrial average rose 0.1% despite continued selling in Dow component Nike (NKE). The stock tripped again, falling more than 2% in heavy volume and crossing below the 200-day moving average. A breakout June 30 on an earnings report has failed, and the stock is likely to remain in the long-term sideways trend it's been in for more than a year.

The Dow utilities index led with a 0.4% increase after news of a major acquisition in the sector.

Sempra Energy (SRE) topped a 117.69 buy point on news that it is acquiring privately held power transmission firm Oncor for $9.45 billion. The offer beat an earlier bid from Warren Buffett's Berkshire Hathaway (BRKB) for $9 billion.

Of about a dozen Stocks On The Move on the upside Monday, eight were Chinese.

58.com (WUBA) may have sparked the rally in Chinese ADRs after the company beat profit and sales expectations this morning. Shares soared 18% in about 10 times more volume than average. No doubt it was an impressive gain, but 58.com (a member of IBD Leaderboard) is already extended. The online marketplace, which has been compared to Craigslist, is at the highest price since January 2016.

TAL Education (TAL), Autohome (ATHM) and China Lodging Group (HTHT) climbed to or near record highs in active trading.

The retail sector was mixed. Auto parts and electronics retail groups rose more than 1%. But internet retail, apparel chains and specialty retail were some of Monday's worst-performing industry groups.

Ulta Beauty (ULTA), one of the biggest names in specialty retail, fell to the lowest level since Nov. 9 and is now 5% off its prior high. Stifel Nicolaus today sharply cut its price target on the cosmetics chain to 270 from 325.

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