T-Mobile Steps Up a Notch While Macy's and J.C. Penney Move in Opposite Directions

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

Stocks ended mixed today, as the Nasdaq moved up 0.3%, the S&P 500 finished flat, and the Dow Jones Industrial Average (DJINDICES: ^DJI  ) closed down 0.4% on weakness in the telecom sector. AT&T (NYSE: T  ) and Verizon fell 2% and 1.6%, respectively, as rival T-Mobile (NYSE: TMUS  ) said it added more than 800,000 new contract customers in the quarter and that its customer defections fell to 1.7% from 2.5% a year ago. T-Mobile has rolled out several enticing offers to boost its stature in the phone wars, including faster upgrades and a new offer to pay $350 to customers willing to break their contracts with the larger service providers and switch to T-Mobile. The move targets AT&T in particular as Ma Bell uses the same network technology, making it easy for its customers to switch to T-Mobile.

Elsewhere, the day's major financial news event, the afternoon release of the Federal Open Market Committee minutes, failed to significantly move markets but nonetheless stirred Wall Street, as investors continued to search for hints on the next step in the stimulus taper. The central bank's notes indicated that it was cautious about beginning to decrease its monthly bond-buying program, which was cut from $85 billion to $75 billion in December. The Federal Reserve's actions have been highly dependent on the monthly jobs report, which comes out Friday, and today ADP reported that 238,000 jobs were added last month, according to its survey. The figure bodes well for the official jobs report at the end of the week.

After hours today, Macy's (NYSE: M  ) shares shot up 5.3%, as the department-store chain announced strong holiday sales and said it will lay off 2,500 workers, or 1.4% of its domestic workforce, though it would add a similar number of jobs in its growing online business. Macy's said comps rose 3.6% in November and December, better than the 2.7% growth experienced across the retail industry, according to the research firm ShopperTrak. The retailer, which has been a rare bright spot in an industry that's been dragged through the mud over the past few months, also provided full-year EPS guidance for the next fiscal year at $4.40-$4.50, above analyst projections at $4.32, and said comparable sales would increase by 2.5% to 3%. Meanwhile, rival J.C. Penney (NYSE: JCP  ) continued its implosion, falling 10% after issuing lukewarm comments on its holiday performance. In a press release this morning, the department-store chain said it was "pleased with its performance for the holiday period" and reaffirmed its outlook for the quarter, but did not provide specific numbers on holiday sales, prompting some analysts to conclude that comps fell at the ailing retailer.

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