What Happened This Week: Index Swings, Grocery Giants And Short Records

 | Oct 14, 2022 22:37

If there was an over-arching theme that encapsulated the events related to the markets this week, it was there was no middle of the road. Examples of extremes – as in, the biggest, quickest, shortest – were in vogue.

So let’s jump in.

h2 Market Swings Described By Superlatives/h2

It was another week of big swings on Wall Street. The big day, of course, was Thursday, when the major indexes put in one of their best days in quite a while.

Looking at the stats, Thursday finished with the S&P 500 posting its fifth largest intraday reversal in its history, according to SentimenTrader, while over on the NASDAQ , the one-day upswing was the fourth largest.

The Dow, which gained 2.8% on Thursday, marked its biggest percentage increase so far in 2022. But let’s not get carried away. It is still down about 18% so far this year.

The moves were all data driven, led by a better-than-expected Consumer Price Index reading.

But then came Friday, and all those gains evaporated. And again, it was all data driven, as worry over the impact of inflation ruled the sentiment.

The Dow closed the day down 1.34%, the S&P 500 lost 2.37%, while the NASDAQ shed 3.08%. And, unfortunately, there was nothing superlative there to take away.

h2 Grocery Behemoth In the Making/h2

A $24.6-billion deal that will see the two largest stand-alone grocery store chains in the U.S. merge was announced yesterday.

The deal, which will see Kroger (NYSE:KR) buy up its smaller rival Albertsons Companies (NYSE:ACI), was hatched in an attempt to take on Walmart (NYSE:WMT). There is nothing mom-and-pop about this grocery-store clash in the making.

And there was nothing middle of the road with this deal. The merger could have an impact on how millions of Americans fill their fridges for years to come. It also has the potential of creating the largest private employer in the U.S.

The deal would face a lot of regulatory scrutiny before being finalized in 2024, however.

According to the terms of the deal that were announced, Kroger will pay $34.10 per share to buy Albertsons, which represents about a 30% premium above the grocer’s average share price in the last month.

Shares of both Kroger and Albertsons were down yesterday. Kroger saw its stock price drop 7.3% to close at $43.16, while Albertsons shares slipped 8.45% to end the day at $26.21.