Dow Notches 4th Straight Win; Rite Aid Rallies Ahead of Earnings

Wal-Mart gains as it embraces tech, Arcos Dorados Holdings jumps on World Cup attention

Jun 18, 2014 at 6:33PM
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The Dow Jones Industrial Average (DJINDICES:^DJI) posted a fourth straight day of gains on Wednesday, as the Federal Reserve continued to taper monthly asset purchases. As expected, the central bank reigned in its bond buying from $45 billion per month to $35 billion per month; officials also said they didn't see interest rates rising until 2015 or 2016, which really got Wall Street excited. Spurred by the central bank's pronouncements, the Dow added 98 points, or 0.6%, to end at 16,906.

Wal-Mart (NYSE:WMT) closed as one of the top performers in the blue chip index, tacking on 1% today. The massive retailer, worth over $240 billion, has struggled to move the needle for investors in the last year, a time in which shares have underperformed the Dow by more than 10%. Part of the equation that Wal-Mart -- and the everyday consumer -- knows it can improve upon is its mobile and online strategy, where Amazon.com has eaten the company's lunch for years. But Wal-Mart's fighting back, becoming more tech savvy, and investors are happy to see it. Yesterday the retailer bought Stylr, an app that allows users to identify nearby clothing that they may be interested in.

Riteaid Logo

Source: Rite Aid website

Rite Aid (NYSE:RAD), a Cinderella stock that's more than doubled in the last year, surged 3.9% on Wednesday ahead of tomorrow's quarterly earnings report. Shares pulled back sharply from 52-week highs earlier this month as the drugstore warned that both its earnings and margins probably wouldn't live up to expectations in the short-term. Rite Aid, like most drugstores, has extremely thin margins, so the smallest changes to margins can mean big differences for the business and its shareholders. Investors will be waiting anxiously for tomorrow's results, where you can expect margins to be in the spotlight.

Lastly, shares of Arcos Dorados Holdings (NYSE:ARCO) jumped 3.4% Wednesday. The stock has finished in the green in each of the last five sessions, as the global attention that the World Cup brings has also brought new eyes to Arcos Dorados. The company is currently the largest McDonald's franchisee in the world, operating in 20 countries across Latin America, including Brazil. Although Brazil is just one of those 20 countries, it accounted for more than 20% of the country's sales last year.

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John Divine has no position in any stocks mentioned. You can follow him on Twitter, @divinebizkid, and on Motley Fool CAPS, @TMFDivine.

The Motley Fool recommends Amazon.com and McDonald's and owns shares of Amazon.com and Arcos Dorados. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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