Wall Street went through a big test on Thursday, and it generally passed with flying colors. Many had been prepared for a pullback following the huge move higher in major stock indexes on Wednesday, but the 600-plus-point plunge in the Dow Jones Industrial Average at times during the session was more than most had expected. Yet by the end of the day, the market had regained all of its losses and then some, with the Dow finishing up over 1%. Even so, some individual stocks sustained damage. J.C. Penney (JCPN.Q), Tesla (TSLA 0.25%), and Spectrum Pharmaceuticals (SPPI) were among the worst performers. Here's why they did so poorly.
J.C. Penney trades for pennies
Shares of J.C. Penney were lower by nearly 9%, falling below the $1-per-share level once again. Naysayers have been waiting for J.C. Penney to succumb to the same trends that sent Sears Holdings into bankruptcy, with the retailer having reported plunging comparable-store sales in the third quarter and expecting to see further declines in the holiday period as well. New CEO Jill Soltau has thus far been unable to produce a marked turnaround from the failed strategies that former chief executive Marvin Ellison pursued, and unless shoppers find a reason to come back to its stores, J.C. Penney is in danger of remaining a penny stock for the foreseeable future.
Elon Musk looks for a lawsuit to go away
Tesla shares dropped 3%, giving back some of their gains from yesterday's volatile session. News today centered on CEO Elon Musk, who filed a request to dismiss a defamation lawsuit from a diver who helped rescue members of a youth soccer team trapped in a Thailand cave earlier this year. Musk argued that his insults were protected free speech, apparently in the belief that what he said wasn't malicious on its face. Investors have repeatedly demonstrated that they're willing to accept Musk's shortcomings in exchange for his acumen, so regardless of the resolution of the lawsuit, it's unlikely to have a long-term impact on Tesla stock.
Spectrum moves forward with Rolontis
Finally, shares of Spectrum Pharmaceuticals were lower by 6.5%. The biotech company reported that it had submitted its Rolontis candidate treatment for breast cancer patients to the U.S. Food and Drug Administration through filing a biologics license application. Spectrum asserts that its phase 3 clinical trials for Rolontis established the efficacy of the treatment, pointing to findings of non-inferiority compared to other drugs. Yet expectations for the drug's sales performance appear to be far weaker than many had hoped, and it could take years for Rolontis to make a marked impact on Spectrum's financial picture. Given the market's turbulence, that's time that Spectrum might not have to make a positive impression on shareholders.