Please ensure Javascript is enabled for purposes of website accessibility

What Happened in the Stock Market Today

By Jim Crumly - Sep 17, 2019 at 5:04PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Corning lowered sales guidance due to weakening business spending, and Shopify is raising cash by selling more shares.

Stocks rallied late in Tuesday's session to finish with gains as oil prices fell after yesterday's spike and investors looked forward to a possible interest rate cut by the Federal Reserve tomorrow. The Dow Jones Industrial Average (^DJI 0.08%) and the S&P 500 (^GSPC -0.07%) rose modestly. Real estate and utilities were the strongest sectors, while energy stocks slumped.

Today's stock market

Index Percentage Change Point Change
Dow 0.13% 33.98
S&P 500 0.26% 7.74

Data source: Yahoo! Finance.

As for individual stocks, Corning (GLW 0.92%) lowered sales forecasts as businesses rein in spending, and Shopify (SHOP -0.47%) announced that it's selling more shares to raise cash for expansion investments.

Colorful graph going up and down.

Image source: Getty Images.

Corning affected by conservative business spending

Corning cut its sales forecast for the third quarter due to slowing demand in two of its five business segments, and despite news of a $250 million pre-payment from Apple, shares fell 6.1%.

In Corning's optical communications segment, its largest by sales, the company said that several major carriers are reducing capital spending on cable deployments and fiber-to-the home projects, and it now expects a third-quarter sales decline in the low teens and full-year sales to fall 3% to 5%. At the beginning of the year, Corning had expected sales to grow by a low-teens percentage.

Corning said that display technologies, the company's largest source of profit, is being affected by conservative buying by TV makers, apparently due to economic uncertainties. The company had expected a weaker quarter, forecasting in the last conference call a low-single-digit decline in glass volumes from Q2, but now thinks the drop will be in high single digits. Corning believes the softness is temporary and continues to see glass prices holding steady.

Shopify raises more cash for growth

Shares of Shopify fell 2.7% to $328.82 after the online sales platform specialist announced a secondary offering of its stock to raise money to fund future growth strategies. Shopify plans to sell 1,900,000 shares at $317.50 per share, raising $603 million in cash, plus offer the underwriters an option for an additional 285,000 shares.

The move comes after last week's announcement that Shopify is acquiring 6 River Systems, a maker of robotic warehouse systems, for $450 million. Shopify plans to spend $1 billion over five years to expand its logistics capabilities, and said in its last conference call that it will accelerate spending on the Shopify Fulfillment Network. The company wants to offer businesses using its platform the ability to provide faster and cheaper shipping services from their own web sites than they could any other way.

The offering represents about a 2% dilution of the outstanding shares of this red-hot growth stock. Shopify also announced new features on its platform to help businesses sell into the fast-growing U.S. market for hemp and cannabidiol (CBD) products.

Jim Crumly owns shares of AAPL and Shopify. The Motley Fool owns shares of and recommends AAPL and Shopify. The Motley Fool has the following options: short January 2020 $155 calls on AAPL and long January 2020 $150 calls on AAPL. The Motley Fool recommends Corning. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Corning Incorporated Stock Quote
Corning Incorporated
GLW
$37.14 (0.92%) $0.34
Shopify Inc. Stock Quote
Shopify Inc.
SHOP
$40.42 (-0.47%) $0.19
Dow Jones Industrial Average (Price Return) Stock Quote
Dow Jones Industrial Average (Price Return)
^DJI
$33,336.67 (0.08%) $27.16
S&P 500 Index - Price Return (USD) Stock Quote
S&P 500 Index - Price Return (USD)
^GSPC
$4,207.27 (-0.07%) $-2.97

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
390%
 
S&P 500 Returns
125%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/11/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.