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Stocks closed out the third quarter with another losing session on Friday, taking the Dow and S&P 500 to new lows for the year. Meanwhile, the Nasdaq came within striking distance of an intraday 52-week low reached in June.

While ongoing concerns about the Federal Reserve drove trading, earnings concerns also contributed to the selling. In one of the most prominent examples, cruise stocks fell in the wake of disappointing results from Carnival (CCL), with Royal Caribbean Cruises (RCL) and Norwegian Cruise Line Holdings (NCLH) dropping in sympathy.

The release of financial figures also prompted selling in Rent-A-Center (RCII) and Nike (NYSE:NKE).

Elsewhere, the Mark Wahlberg-backed F45 Training (FXLV) defied the day’s overall negative sentiment. Shares popped more than 40% on news of a takeover bid.

Sector In Focus

Carnival (CCL) reported disappointing quarterly results and issued an uninspiring booking update, raising concerns about travel demand in the face of a shaky economic situation. As a result, the earnings report sparked selling throughout the cruise sector.

With EPS and EBITDA figures below expectations and advanced Q4 bookings below the historical normal range, CCL plunged 23% on the session. This dragged down competing cruise lines Royal Caribbean Cruises (RCL) and Norwegian Cruise Line Holdings (NCLH), which dropped 13% and 18%, respectively.

Standout Gainer

A buyout offer prompted a wave of buying in the beaten-down fitness studio chain F45 Training (FXLV). Shares surged 41%.

The company, which includes actor Mark Wahlberg as an investor, received a non-binding takeover offer from holder Kennedy Lewis Management. According to a regulatory filing, the firm, which holds a 14.6% stake in FXLV, has bid $4 per share to buy the remaining shares it does not own.

On the news, FXLV jumped 90 cents to close at $3.09. The stock came public last year at $16 a share and reached a peak of $17.75 shortly after coming public.

Standout Decliner

Rent-A-Center (RCII) posted a substantial decline, weighed down by a weak forecast included in its latest quarterly report. The earnings news sparked a 22% drop in its stock.

The household appliance rental chain reported quarterly earnings and revenue that exceeded analysts’ projections. However, the firm issued a disappointing prediction for Q3, targeting adjusted EPS of $0.85 to $0.95, down from its prior outlook of $1.05 to $1.25.

RCII finished Friday’s trading at $17.51, down $4.82 on the session. The stock also touched an intraday 52-week low of $17.50. Overall, shares have retreated 64% for 2022 as a whole.

Notable New Low

The release of a weak quarterly report sent Nike (NKE) spiraling. With efforts to clear inventory cutting into margins, NKE dropped almost 13%, reaching a new 52-week low.

NKE topped expectations with its headline profit and revenue figure, with the top line climbing 4% from last year. However, gross margin dropped 220 basis points to 44.3%.

Following the report, NKE dropped $12.21 to close at $83.12. During the session, the stock reached an intraday 52-week low of $82.50.

Looking longer-term, shares have fallen about 22% over the past month. Meanwhile, NKE has lost nearly half its value since the close of 2021.

To see the other best- and worst-performing stocks of the session, head over to Seeking Alpha’s On The Move section.


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