Market Minute: Shutdown Threatens Retail Sales, Forces Factory Layoffs

The government shutdown worries retailers, and it leads to layoffs in manufacturing. Those and more are what's in Thursday's Market Minute.

The Dow Jones industrial average (^DJI) fell 58 points Wednesday, the Standard & Poor's 500 index (^GPSC) lost a point and the Nasdaq composite index (^IXIC) slipped 3.

government shutdown threatens improved holiday retail sales
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A number of retailers are reporting September and third-quarter sales this morning, and the numbers aren't expected to be very good. The back-to-school season was disappointing, especially for retailers that cater to teens such as Abercrombie & Fitch (ANF), Aeropostale (ARO), American Eagle Outfitters (AEO) and Ascena Retail Group (ASNA). Weak back-to-school sales often portend a weak holiday shopping season.

The National Retail Federation forecasts holiday sales will increase by nearly 4 percent from last year, but warns that forecast could be cut if consumers reduce their spending because of the paralysis in Washington.

The jewelry chain Zale (ZLC) is losing some of its luster. The company says private-equity firm Golden Gate Capital may sell up to 11 million shares of Zale stock.

United Technologies (UTX) will furlough 2,000 workers from its Sikorsky helicopter unit as a result of the government shutdown. Several thousand more could face furloughs if the budget stalemate isn't resolved in the next week or so. And Boeing (BA) warns an extended shutdown could force the company to delay deliveries of the 787 Dreamliner and other newer model planes.

Shares of Angie's List (ANGI) remain volatile following reports the company is slashing the cost of membership in several key markets. The company is testing a $10 annual fee in New York, Washington, Chicago and several other markets. That's down from $40.

A bidding war could be brewing for Blackberry (BBRY). News reports say a second private equity group is considering an offer to compete with the tentative deal Blackberry already has with Fairfax Financial Holdings.

And activist investor Bill Ackman is reducing his bet against Herbalife (HLF). He claims the maker of nutritional supplements is run like a pyramid scheme. But so far, he's lost an estimated $300 million, as the stock has rallied this year.

-Produced by Drew Trachtenberg.

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