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Why Are These Stocks Deep in Red Territory Today?

With the retail sector set for a gloomy holiday shopping season this year, shares of Best Buy Co Inc (NYSE:BBY) have also taken a hit today after the company reported weak third quarter sales. The stock fell by as much as 8.5% before regaining some of the losses, but the weak outlook for the fourth quarter is going to keep investors on their toes. The company said it expects a low single-digit drop in sales during the holiday season. For the third quarter, Best Buy announced revenue of $8.82 billion, down by 2.4% year-over-year, and earnings of $0.41 per share, versus expectations of $8.84 billion in revenue and earnings of $0.35 per share.

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Hedge funds started to distance themselves from Best Buy Co Inc (NYSE:BBY) during the third quarter, with the number of funds reporting a long position in the stock dropping to 28, from 34 at the start of the quarter. David Harding, the manager of Winton Capital Management, is still optimistic about the prospects of the company, further increasing his stake during the quarter to 4.14 million shares worth $153 million. Cliff Asness seems to have changed his mind about Best Buy, reducing his stake during the quarter by 8% to 6.39 million shares.

The latest correction in oil prices has put pressure on energy stocks, with Chesapeake Energy Corporation (NYSE:CHK) down by more than 8% today. Crude oil entered a downtrend in the beginning of November, falling for eight days in a row before reaching support around the $40 level. The U.S. Energy Information Administration reported an increase in crude oil supply yesterday, putting more pressure on oil and energy stocks. Players in the energy market are already looking forward to the next OPEC meeting on December 4, searching for signs of a change in their strategy to maintain market share by keeping production at high levels.

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At the end of September, Chesapeake Energy Corporation (NYSE:CHK) could be found in the portfolios of 34 top funds that we track, which held roughly 25% of its outstanding stock. Billionaire activist Carl Icahn is keeping tabs on the energy company, having reiterated his stake in the latest round of 13F filings. Icahn Capital LP holds a little over 73 million shares valued at $535 million. On the other hand, Mason Hawkins’ Southeastern Asset Management continued to dump the stock, reducing its holding to 57.9 million shares by the end of the third quarter.

Disclosure: None

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