Chattanooga-area stocks mixed as overall market gains in third quarter

FILE - In this Sept. 18, 2019, photo stock prices are displayed at the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EDT on Monday, Sept. 30. (AP Photo/Mark Lennihan, File)
FILE - In this Sept. 18, 2019, photo stock prices are displayed at the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EDT on Monday, Sept. 30. (AP Photo/Mark Lennihan, File)

Investors looking for big profits in the third quarter should have been whistling Dixie, or at least investing in the Dalton, Ga.-based carpet maker Dixie Group which more than doubled its stock price in the quarter ended Monday.

Dixie Group, which shed more than 85% of its value in the past five years, rebounded in the third quarter of this year to boost its stock price by 138% in the past three months, including a 9.5% gain on Monday.

Dixie Group was among the biggest winners in the market during the third quarter. But two other local stocks which were battered in previous years also saw healthy gains in the third quarter.

CBL Properties, whose stock fell Monday by 7.2% following the announcement that Forever 21 had filed for bankruptcy, still gained 34% in its stock price in the most recent quarter. CBL's common stock is still down more than 90% from its 2013 peak.

Local stocks mixed in quarter

In the three months ended Sept. 30, four of the local publicly traded stocks rose in price and the other three fell in price.* Dixie Group rose 138% in the quarter to $1.38 per share* CBL Properties rose 34% in the quarter to $1.29 per share* Covenant Transport closed at $16.44, up 11.8% in the quarter* Miller Industries closed at $33.30, up 8.9% in the quarter* Astec Industries closed at $31.10, down 4.2% in the quarter* Unum closed at $29.72, down 10.6% in the quarter* Mohawk Industries closed at $124.07, down 15.9% in the quarterSource: NYSE, Nasdaq. By comparison, the S&P 500 rose 1.2% in the quarter to 2,976.74

Covenant Transport, which shed from than half of its value in the previous 12 months going into the third quarter, also bounced back some this summer with a healthy 11.8% gain in the quarter.

Miller Industries also enjoyed an 8.9% rise in its stock price in the past quarter, but the two biggest stock-traded companies with headquarters in the Chattanooga area - Unum and Mohawk Industries - both recorded double-digit declines in their stock prices in the most recent quarter.

U.S. stocks overall climbed on Monday and gave one last nudge to ensure the S&P 500 emerged from yet another tumultuous quarter with a modest gain.

As has been the case throughout the quarter, movements in President Donald Trump's trade war with China helped drive the market on Monday. Investors found encouragement after China said that its top trade negotiator will lead talks with the United States that are expected to take place next week. The Trump administration also calmed some worries that it may limit U.S. investment in Chinese companies.

The developments helped push technology stocks higher in particular. Those companies often move along with worries about trade because of how reliant they are on China as both a customer and a supplier. The S&P 500 climbed 14.95 points, or 0.5%, to 2,976.74.

The Dow Jones Industrial Average rose 96.58, or 0.4%, to 26,916.83, and the Nasdaq composite added 59.71, or 0.8%, to 7,999.34.

The moves left the S&P 500 with a 1.2% gain for the quarter. While that was its smallest quarterly gain this year, the index had been on track for a much worse performance just a month ago.

Trump shocked markets in August when he said he's raise tariffs on Chinese goods, and the announcement sent stocks and bond yields reeling. The S&P 500 dropped more than 6% in the weeks following July 26, when it set its last record. But stocks began climbing again in September as both sides made conciliatory moves to ease tensions.

Like the S&P 500, the Dow also ended the quarter with a gain of 1.2%. The technology-heavy Nasdaq was a touch lower, with a loss of 0.1%.

Small companies took more damage, as they typically do when investors are worried about the threat of a recession. The Russell 2000 lost 2.8% during the quarter.

Don't expect the tumult to end with the close of the quarter.

Aside from the U.S.-China talks, the next three months have plenty of events on the schedule to keep markets on edge. Beyond the United Kingdom's pending exit from the European Union, investors are also waiting to see whether Germany will enter a recession and how the new incoming head of the European Central Bank performs.

Closer to home, the impeachment inquiry into Trump could create even more uncertainty. That puts more pressure on what's been the bulwark of the U.S. economy recently, particularly when businesses have become reluctant to spend due to the trade war.

"The consumer's been enough to keep the economy moving, but things like consumer confidence seem to be plateauing," said Emily Roland, co-chief investment strategist at John Hancock Investment Management.

Last year, the S&P 500 slumped 14% in the fourth quarter for its worst performance in seven years when fear spiked that the Federal Reserve's plans to keep raising interest rates and a slowing global economy would knock the United States into a recession.

This time around, the Federal Reserve has shifted gears, and many investors expect the central bank to cut rates at least one more time this year. That could help support markets, even with all the potential flashpoints set on the calendar.

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