Summary: Stocks jumped on Fed minutes; Alcoa earnings rise; Gap CEO to retire; Costco profits beat forecasts. Bobbi Rebell reports.
Stocks rallied sharply Wednesday - the Federal Reserve's latest minutes reinforcing views that no interest rate hike will kick in until later next year. But the debate is heating up over the statement's use of the phrase "considerable time" on how long rates will stay low- they may want to communicate more flexibility in the timing of a rate hike. The minutes suggest the Fed could tweak its language on a rate hike as early as this month's meeting. Also a concern- the weak global economic picture- and the strong dollar. Yields on bonds dipped after the minutes release. Gap stock fell in after hours trading- its CEO is retiring. In earnings news- Alcoa- out with good numbers- profits were higher thanks to higher aluminum prices. Costco's profit topped Street estimates for the first time in five quarters helped by healthy back-to-school sales and higher membership fees. Meanwhile Monsanto, the world's largest seed company, warned that earnings for its coming fiscal year will fall short of forecasts due to declining crop prices and bigger costs. Shares of Sears Holding Corp. plunged on word that one of the chain's vendors is cutting shipments on worries about liquidity, according to a Bloomberg report. Its just the latest problem for the retailer says Brian Sozzi of Belus Capital. SOUNDBITE: BRIAN SOZZI, CEO, BELUS CAPITAL ADVISORY (ENGLISH) SAYING: "Because of years of not adding fixtures, not adding, as silly as this might sound, the right manequins the right merchandise you are creating a millenial geneation that no longer even thinks about Sears - just walks past it to go to Zara and H&M and that is a big problem." Also taking a hit - JC Penney. Despite turnaround efforts, the retailer lowered its sales outlook for the current quarter citing weak sales last month. Pharmaceutical company Actavis is said to be taking a hard look at Botox maker Allergan- and may reach out to start formal merger discussions this week. And expect some fireworks tomorrow on Apple- Activist investor Carl Icahn tweeted he will be sending a letter to CEO Tim Cook and quote "believe it will be interesting". Overseas European stocks hit a two-month low on concerns about global growth.