Telecom Services and Consumer Staples Were Weaker
After showing weakness for two consecutive trading weeks, the telecom services sector started the week on a lighter note. The S&P 500 Telecom services sector fell 0.8%. Iridium Communications (IRDM), Oclaro (OCLR), and United States Cellular (USM) were the top losers in the telecom services sector on February 6.
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Iridium Communications, which operates the Iridium satellite constellation—a system of 66 active satellites, fell 6.6% on Monday. Recently, Iridium Communications entered into a contract with SpaceX to launch five Iridium NEXT satellites. The satellites are scheduled to release in early 2018.
After closing last week at the highest levels since September, the consumer staples sector lost strength at the beginning of the week. On February 6, the S&P 500 Consumer Staples sector fell 0.42%. Tyson Foods (TSN), Sysco (SYY), and General Mills (GIS) were the top losers in the consumer staples sector on Monday. Tyson Foods, a US multinational corporation that operates in the food industry, fell 3.5% on Monday.
Tyson Foods lost strength because it received a subpoena from the U.S. Securities and Exchange Commission with an allegation of conspiring with rivals on pricing chicken. According to US poultry buyers’ claims, Tyson Foods conspired with its competitors for years to reduce the output and manipulate chicken prices. On the other hand, the company released better-than-expected quarterly results. According to the report, Q1 sales rose to $9,182 million—higher than the forecast of $9,152 million. Tyson Foods expects a capital expenditure of $1 billion for 2017.
Sysco, which markets and distributes food products, fell 2.6% on Monday. Sysco started the day higher but fell as the day progressed. According to the quarterly earnings report, sales fell 0.2% to $12.1 billion excluding brakes. The gross profit rose 2.9% to $2.2 billion excluding the brakes. Next, we’ll discuss how commodities are performing in the early hours.