The stock market was generally down on Thursday, as the Dow Jones Industrial Average fell almost 200 points and led other major benchmarks lower. As investors wait for the beginning of second-quarter earnings season next month, their attention remains squarely on geopolitical and macroeconomic issues, and the escalating economic tensions between the U.S. and major trading partners across the globe show no signs of reversing course in the near future. Bad news for some individual companies also weighed on sentiment. Stamps.com (NASDAQ:STMP), iQiyi (NASDAQ:IQ), and Alkermes (NASDAQ:ALKS) were among the worst performers on the day. Here's why they did so poorly.
Stamps.com: Victim of postal reform?
Shares of Stamps.com dropped 10% after reports that the White House had once again turned its attention to the troubled fortunes of the U.S. Postal Service. A restructuring proposal looked at potential strategic moves to address the financial problems that the Postal Service has faced for years, with some options including either finding new ways to avoid losing money or seeking to convert it into a private entity through privatization. If the federal government follows through, it could destroy Stamps.com's business model of helping customers handle their shipping and postage needs.
iQiyi gives back some ground
iQiyi stock fell 12%, falling back from huge gains in recent weeks. The Chinese streaming video specialist saw its shares double in just a single month between early May and early June after having come public in late March, with a strong debut in its quarterly financials and a highly successful strategic partnership with e-commerce company JD.com. Even today, iQiyi said that it had expanded its content offering lineup to give viewers more options. When stocks climb so sharply, significant pullbacks often follow, but investors should remember that iQiyi is still up more than 100% from its $18-per-share IPO price.
Alkermes deals with competition
Finally, shares of Alkermes lost 15%. The decline for the biotech stock came in the face of good news for rival Heron Therapeutics, which earned breakthrough therapy status from the U.S. Food and Drug Administration for its pain management treatment HTX-011. Alkermes has a key treatment called Vivitrol on the market to fight opioid abuse, but investors seem concerned that Heron's non-opioid pain medication will reduce the need for medical professionals to prescribe opioid-based drugs. There's a long way to go before this race is over, but Heron's news still had Alkermes shareholders concerned about the immediate future.