Monday was a slow start to the week for the stock market, and major market benchmarks lost modest amounts of ground as investors paused following a strong first-quarter performance to start 2017. Earnings season is about to begin again, and the onus will be on companies to continue building positive momentum in order to push the overall market higher. Yet several companies came out with discouraging news today, and DryShips (NASDAQ:DRYS), United Therapeutics (NASDAQ:UTHR), and Fiat Chrysler Automobiles (NYSE:FCAU) were among the worst performers on the day. Below, we'll look more closely at these stocks to tell you why they did so poorly.
DryShips deal makes investors nervous
Shares of DryShips plunged 19% after the shipping company said that it had entered into an agreement to sell as much as $226 million in common stock to financing source Kalani Investments Limited. Under the deal, DryShips has two years to sell stock to Kalani to raise cash under certain circumstances. In addition, DryShips said that it will buy a total of six vessels, spending $268 million to acquire ships in the Aframax, Kamsarmax, and very-large gas carrier categories. CEO George Economou praised DryShips' efforts to refresh the company's fleet, but some investors appear increasingly nervous that the level of risk that the shipping specialist is taking on could prove to be catastrophic if the market for ocean-based shipping doesn't improve quickly and markedly.
United Therapeutics deals with setbacks
United Therapeutics stock dropped 8% in the wake of two adverse pieces of news. Late Friday, the biotech specialist said that it had lost a patent dispute against SteadyMed with respect to several of its most important drug offerings, with the Patent Trial and Appeal Board finding that United's claims weren't in fact patentable. Then early Monday, United said that it would have to postpone the U.S. launch of its RemoSynch implantable system for its Remodulin treatment for pulmonary arterial hypertension. CEO Martine Rothblatt tried to reassure investors, noting that the delay "is a small miss in the context of our providing more U.S. pulmonary arterial hypertension patients with helpful medicines than any other country." Nevertheless, investors want to see United Therapeutics taking full advantage of leadership opportunities in the field, and today's concerns made shareholders nervous looking forward.
Fiat sees lower industry sales
Finally, shares of Fiat Chrysler Automobiles finished down 5%. The automaker led the major auto stocks downward in the wake of sluggish sales results for March, which included the worst overall levels in over two years. Fiat in particular said that U.S. sales dropped 5% to just over 190,250 units, falling from nearly 200,000 units sold in March 2016. Despite the news, several Fiat Chrysler brands showed successful numbers, including a 10% rise for the Dodge brand, 6% gains for Ram Trucks, and a 22% jump in sales of the Jeep Grand Cherokee. Double-digit percentage gains for the Fiat 500 also showed the value of combining the Fiat and Chrysler names, but other Jeep and Chrysler brands suffered substantial declines to weigh on the company's overall growth. If this is the feared slowdown that investors have anticipated for years, then Fiat Chrysler could remain under pressure for some time.