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Stocks finish higher following another choppy session

Stocks finished higher on Thursday with the major averages logging modest gains following another choppy session for U.S. stocks.

When the closing bell rang on Wall Street, the S&P 500 was up 0.24%, the Dow up just less than 0.1%, and the Nasdaq up up 0.2%.

This rebound followed trading on Wednesday that saw all three indexes post losses with the Nasdaq falling more than 1%.

Underneath the surface of indecisive indices, the retail sector remained in focus, with the latest meme rally for Bed Bath & Beyond (BBBY) and earnings out of BJ's Wholesale Club (BJ) and Kohl's (KSS) drawing the bulk of investor attention.

Results from Kohl's before the opening bell disappointing to the downside, and shares of retailer closed Thursday's session down nearly 8%.

Kohl's slashed its full-year forecast, saying it expects sales will fall 5%-6% after having previously expected a modest increase in sales this year. Full-year earnings per share are now expected to be between $2.80-$3.20; the company had previously expected earnings per share in a range of $6.45-$6.85.

On the flip side, shares of BJ's Wholesale Club gained 7% on Thursday after the company reported results that topped estimates and the company raised its profit forecast.

In a release, the company said: "Our business model is designed to work well in the current consumer environment where value is king." Same-store sales at BJ's clubs rose 19.8% over the same period last year during the second quarter.

The Kohl’s label is seen on a shopping cart in a Kohl’s department store in the Brooklyn borough of New York, U.S., January 25, 2022.  REUTERS/Brendan McDermid
The Kohl’s label is seen on a shopping cart in a Kohl’s department store in the Brooklyn borough of New York, U.S., January 25, 2022. REUTERS/Brendan McDermid (Brendan McDermid / reuters)

Elsewhere in retail, shares of Bed Bath & Beyond remain a fascination for investors, with shares falling 19.6% after an SEC filing on Wednesday revealed Ryan Cohen has filed to sell his entire stake in the retailer.

Cohen's RC Ventures, which owns an 11.8% stake in retailer, revealed plans to unload the stake in a Form 144 filed with the SEC on Tuesday; as of the filing date, Cohen had not sold any shares. Cohen first revealed his position in Bed Bath & Beyond in March.

In a statement on Thursday, Bed Bath & Beyond said: "We were pleased to have reached a constructive agreement with RC Ventures in March and are committed to maximizing value for all shareholders. We are continuing to execute on our priorities to enhance liquidity, make strategic changes and improve operations to win back customers, and drive cost efficiencies; all to restore our company to its heritage as the best destination for the home, for all stakeholders. Specifically, we have been working expeditiously over the past several weeks with external financial advisors and lenders on strengthening our balance sheet, and the Company will provide more information in an update at the end of this month."

In another oddity related to this saga, the Financial Times late Wednesday reported a 20-year-old college student from New Jersey cashed in $110 million during Bed Bath & Beyond's recent rally. Jake Freeman told the FT he raised $25 million from friends and family, put it all on Bed Bath & Beyond, sent the company a letter demanding it fix its capital structure, and then cashed out.

On the index level, traders continued to monitor the 200-day moving average on the S&P 500, a level the index reached on Tuesday and has since traded below, suggesting the market's long-term trend remains in control.

WTI crude oil futures, which on Tuesday notched the lowest settlement since January 25, were up more than 2.5% on Thursday, with the price of oil settling near $90.60 a barrel.

On the economic data side, the weekly report on initial jobless claims showed fewer Americans than expected filed for first-time unemployment insurance last week. Data showed 250,000 initial claims were filed, less than the 260,000 that economists had expected. Initial claims have been closely-watched through the summer for signs of a softening labor market.

Existing home sales data also showed a sharper-than-expected drop in the number of completed transactions last month, with home prices declining from June to July, the first month-on-month drop in prices since January. Still, home prices rose 10.8% over last year in July.

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