Wall Street saw a mixed session on Wednesday, as investors tried to parse through the latest move by the Federal Reserve and the first press conference from new Fed Chair Jay Powell. Major benchmarks initially responded to the news of the quarter-point rate hike by remaining in positive territory, but comments from Powell later in the news conference seemed to give market participants pause, and the Dow, S&P 500, and Nasdaq Composite all finished with slight losses. Also hurting sentiment was bad news from several individual companies. Alder Biopharmaceuticals (NASDAQ:ALDR), Micro Focus International (NYSE:MFGP), and Dominion Energy Midstream Partners (NYSE:DM) were among the worst performers on the day. Here's why they did so poorly.
Alder bids its leader goodbye
Shares of Alder Biopharmaceuticals plunged 15% after the clinical-stage company said that co-founder Randy Schatzman had left his position as CEO. Alder acted swiftly to name one of the members of its board of directors, Paul Cleveland, as interim CEO, but investors were still nervous about the move. Alder's press release quoted Schatzman as saying, "Now is the right time to pass the baton to the next generation of leadership." But with some key events coming up in the near future, Cleveland will have to get up to speed extremely quickly in order to ensure that Alder's interests are protected and furthered to the greatest extent possible.
Micro Focus tumbles again
Micro Focus International stock fell another 5%, adding to its losses earlier in the week. On Monday, Micro Focus plunged about 40% after the U.K. technology company disappointed investors with downward revisions to its full-year revenue guidance and CEO Chris Hsu's resignation. Investors still appear to be worried about the transition despite Micro Focus' immediate naming of COO Stephen Murdoch to take over as CEO, perhaps because of the company's comments about its ability to execute well in closing sales. Given how competitive the tech space has become in many areas, Micro Focus can't afford to lose time or waste effort in keeping up with its rivals in the industry.
Dominion loses its grip
Finally, units of Dominion Energy Midstream Partners dropped nearly 6%. The master limited partnership has lost about a third of its value in less than a week, with one cause coming from an adverse shift in the way the Federal Energy Regulatory Commission will allow pipeline MLPs to account for taxes in setting customer rates. Since then, a number of analysts have weighed in on the issue, suggesting that Dominion in particular could face a negative impact from the FERC decision. That, in turn, could reduce the amount and growth in distributions from the MLP, and it may spur parent companies to stop using MLPs to as large an extent in their capital strategies.