The stock market didn't make dramatic movements on Tuesday, and major benchmarks ended the session fairly close to where they started it. The long-anticipated summit between U.S. President Donald Trump and North Korea's Kim Jong Un didn't produce much in the way of surprises, allowing investors to turn their attention to this week's meeting of the Fed's Open Market Committee. Even though it was a quiet day, some companies had bad news that sent their shares sharply lower. Xunlei (NASDAQ:XNET), Griffon (NYSE:GFF), and Axovant Sciences (NASDAQ:AXON) were among the worst performers on the day. Here's why they did so poorly.
Xunlei falls back
Shares of Xunlei dropped 14%, giving back their gains from Monday's session as investors continued to struggle to figure out the strategic direction in which the Chinese company wants to move. For a long time, the tech company focused on cloud services, but like some other companies, Xunlei made a move toward embracing cryptocurrency and blockchain-based applications in response to the surge in bitcoin and other crypto-token prices during 2017. Yet with its initial coin offering having run into problems and with more hostile attitudes toward cryptocurrency in its home market, Xunlei has given up ground during most of 2018 as bitcoin prices have fallen. Until investors can figure out whether Xunlei will stick to one specific strategic direction, the company's stock is likely to move in line with the prospects for long-term success in the cryptocurrency markets.
A Griffon shareholder sells out
Griffon stock fell 12% after the maker of home and building products and defense electronics announced plans to hold a stock offering on behalf of one of its major shareholders. The announcement said that an affiliate of Goldman Sachs would seek to sell 5.58 million shares of Griffon stock, worth roughly $128 million at the beginning of the day, in an underwritten public offering. Since all the stock is held by Goldman, Griffon won't get any proceeds from the sale. It's disappointing for investors to see a major shareholder decide to cut back on its position, though, especially when Griffon hasn't even yet returned to the record highs it set back in late 2016.
Axovant loses some ground
Finally, shares of Axovant Sciences plummeted 18%. The biotech stock has been exceptionally volatile since earlier this month, when Axovant said that it would obtain rights through a licensing agreement to a candidate treatment involving gene therapy to treat Parkinson's disease. Having experienced both successes and failures in the past, Axovant has watched its stock make massive moves both upward and downward, and investors have spent the past week and a half trying to figure out the long-term implications for the company. At this point, it's simply too early to tell whether Axovant's deal will bear fruit, but shareholders can expect further volatility until details of trials and other news become available.