After a brief respite yesterday, the stock market continued its downward course on Thursday, and market commentators again pointed to global economic concerns to justify the move. Weakness in the energy market again took its toll on the broader market, and oil prices moved below $37.50 per barrel in reversing a portion of their impressive bounce over the past month. Major market benchmarks fell between 1% and 1.5% for the day, and investors are starting to look anxiously toward the looming earnings season as a guide to whether the market can sustain its rebound or if it will begin a new leg lower as the quarter progresses.
Despite overall pressure, several stocks managed to climb significantly, and among the best performers were Relypsa (RLYP), Kinross Gold (KGC -0.22%), and Ollie's Bargain Outlet Holdings (OLLI -1.95%).
Relypsa soared by 68% after reports surfaced that the biotechnology company is working with an investment bank in order to review potential acquisition bids. Although the reports indicated that any discussions hadn't progressed very far and might not lead to an actual takeover proposal, investors didn't wait before bidding up shares of the stock dramatically. Relypsa is one of two key players in the multibillion-dollar market to treat hyperkalemia, which is a blood disorder, and Relypsa's main competitor was taken over in an acquisition bid of its own recently. If some of the companies that were interested in that competitor still want exposure to the hyperkalemia market, then Relypsa is their only vehicle for doing so, and that could create a bidding war that could be extremely lucrative to for shareholders if these early reports turn into concrete action.
Kinross Gold gained 6%, leading advances from several other gold-mining stocks. Gold prices moved up almost $20 per ounce on Thursday, climbing above the $1,240 per ounce mark in response to weakness in the U.S. dollar. The move sent Kinross shares to their highest level since 2014, but they still stand nearly 80% below their highs from 2011, during the height of the bull market in gold. Further weakness in the dollar could continue to support gold, and that in turn would make Kinross and its gold-mining peers more profitable. Investors need to remember, though, that previous upward bounces for gold prices have proved short-lived, so there's no guarantee today's move won't turn out to be another headfake for shareholders.
Finally, Ollie's Bargain Outlet Holdings rose 10%. The little-known discount retailer of closeout merchandise reported its fiscal fourth-quarter earnings Wednesday night, and its results were better than investors had expected, including adjusted earnings of $0.31 per share that exceeded the consensus forecast for $0.27. The retailer had its IPO in mid-2015, and it has built out its network to more than 200 stores, with plans for further growth during the coming fiscal year. Investors were also excited about Ollie's guidance for fiscal 2017, which included sales projections of $865 million to $875 million. In what has been a tough retail environment, Ollie's success stands out even more than it otherwise would.