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Morning Market Roundup: JC Penney Profits Freefalling, Unemployment Stagnant, April Home Foreclosures


Here’s what’s important in the business world this morning:

JC Penney: J.C. Penney on Tuesday reported a larger-than-expected first-quarter loss.

Revenue dropped 20 percent to $3.15 billion for the quarter as customer traffic slipped 10 percent. Meanwhile, revenue at stores opened at least a year - a figure used to measure a retailer's health - was down 18.9 percent. That's a much steeper fall than the 11.4 percent drop Wall Street was expecting.

Penney shares soared 24 percent to about $43 after CEO Ron Johnson announced the company’s new pricing strategy in late January. But since the middle of February - after the new pricing was rolled out in stores- investors have sent shares back down to around $34. After Penney reported the disappointing first-quarter results after the markets closed on Tuesday, its shares fell 12 percent to $29.30 in after-hours trading.

Of course, courting two nationwide boycotts from conservative mothers probably didn't help anything either.

U.S. Unemployment: The number of people seeking unemployment benefits was unchanged last week.

The Labor Department said Thursday that weekly unemployment aid applications stayed at a seasonally adjusted 370,000, the same level as the previous week. The four-week average, a less volatile measure, fell for the second straight week, to 375,000.

Applications for benefits surged in April to a five-month high of 392,000. The pace of hiring slowed sharply in March and April, to an average of 135,000 jobs per month. That raised fears that the job market is weakening.

U.S. Futures Down: Stock futures are falling, with unease about Europe overshadowing what is expected to be another positive U.S. employment report and also some big numbers from the world's largest retailer.

Dow Jones industrial average futures are down 32 points to 12,542. Standard & Poor's 500 futures are down 4.9 points to 1,317.5. Nasdaq composite futures are sliding 10.75 points to 2,546.75.

Economists forecast that weekly applications for U.S. unemployment benefits fell by 2,000 to a seasonally adjusted 365,000, according to a survey by FactSet. The Labor Department will release the report at 8:30 a.m. Eastern time Thursday.

Still, economic uncertainty is prompting continued caution from U.S. consumers, and a heightened emphasis on bargains from Wal-Mart Stores Inc. is paying off. The company is posting a 10.1 percent jump in first-quarter profit.

Home Foreclosures: National foreclosure trends took a positive turn in April, as the number of homes seized by banks declined and fewer properties entered into the foreclosure process.

But state-level data point to potentially more home repossessions ahead in Florida and many of the 25 other states where courts are required to sign off on foreclosures.

All told, the number of U.S. homes taken back by lenders in April declined 7 percent from March, the third consecutive monthly decline, foreclosure listing firm RealtyTrac Inc. said Thursday. Home repossessions fell 26 percent versus April last year.

The number of homes that lenders placed on the foreclosure path last month also declined, falling 4 percent from March and 2 percent from April 2011, the firm said.

The Associated Press contributed to this report.

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