Excerpt from our One Page Annotated Wall Street Journal Summary (receive it by email every morning by signing up here):
SMALL STOCKS: P.F. Chang's China Bistro, Mothers Work Gain
Summary: Small stocks were hit hard in trading yesterday with restaurant stocks a notable exception. Both small stock indexes fell yesterday with the Russell 2000 index of small-cap stocks losing 0.52%, to 677.69 and the S&P SmallCap 600 index shedding 0.86%. In the restaurant group, small stocks climbed after large-cap McDonald's (NYSE:MCD) said second-quarter earnings would exceed expectations. Gainers included P.F. Chang's China Bistro (NASDAQ:PFCB), up 3%, and Lone Star Steakhouse & Saloon (NYSE:STAR), which climbed 2.2%. Energy exploration and production stocks declined after crude-oil futures pulled back from last week's highs on speculation the fighting in the Middle East would soon end. Among small energy-related stocks, Penn Virginia (PVA) slid 3.4% while Comstock Resources (NYSE:CRK) declined 3%. In terms of individual performers, Spectrum Brands (SPC) had the distinction of being the NYSE's top decliner, plunging 33% after reducing its fiscal-2006 earnings guidance, partly because of weak battery sales in Europe; Threshold Pharmaceuticals (THLD) fell 51% after plans to discontinue development of its TH-070 compound intended to treat men with enlarged prostates had to be discontinued because of disappointing results from clinical studies; IMA Exploration (IMR), a Vancouver precious-metals exploration company, tumbled 80% after a legal decision required the company's Argentinian silver mines be transferred to Canada's Aquiline Resources. Individual gainers included Magic Software Enterprises (NASDAQ:MGIC), which jumped 65% after the Israeli technology company said it signed a three-year global distribution and manufacturing agreement with large-cap IBM. Ituran Location & Control (NASDAQ:ITRN) climbed 6.7%; Mothers Work (MWRK) rose 3.8%; Wheeling-Pittsburgh (WPSC) gained 7.8%; PokerTek (NASDAQ:PTEK), a marketer of electronic poker tables, gained 9% after the Charlotte, N.C. company announced a three-year contract to provide its PokerPro electronic-poker tables to large-cap Carnival's (NYSE:CCL) cruise ships.
Comment on related stocks/ETFs: Spectrum Brand's (SPC) 33% decline yesterday comes on-the-heels of equally steep declines in April '06 and August '05. According to regular Seeking Alpha contributor David Phillips, many of the reasons for those earlier declines, such as a management "more interested in egocentric than shareholder concerns" and pricing pressure resulting from rising commodity expenses, especially for zinc, are ever-present. For more on SPC's last big fall, check out Seeking Alpha's SPC archive.