By ALEX VEIGA-AP Business Writer
Wall Street shares have fallen on Tuesday after Wal-Mart warned that inflation was negatively impacting US consumer purchasing power. The S & P 500 Index fell 1.2%, the Dow Jones Industrial Average fell 0.8%, and the Nasdaq Composite Index fell 1.9%. Wal-Mart’s share price plummeted after retail giants lowered its earnings outlook for the second quarter and the full year, and rising food and gas prices forced shoppers to cut more profitable discretionary items, especially clothing. He said he couldn’t get it anymore. Technology and telecommunications stocks were also one of the biggest weights on the market.
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Wall Street shares have fallen in trading Tuesday afternoon after Wal-Mart warned that inflation was negatively impacting the purchasing power of American consumers.
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The S & P 500 fell 1.3% at 2:42 pm east, clearing up a slight rise from the previous day. The Dow Jones Industrial Average was 31,744, down 247 points (0.8%), and the Nasdaq Composite Index fell 2%.
Wal-Mart’s share price fell 8.3% after retail giants lowered their earnings outlook for the second quarter and the full year.
Walmart profit warning Rare in the middle of the quarter, there is growing concern about how the highest inflation in 40 years is affecting the retail sector as a whole. Inventories of other major chains declined following Wal-Mart’s announcement after the Wall Street Closing Bell on Tuesday. Targets fell 4.2%, Macy’s fell 6.5%, and Coles fell 8%.
Investors are deeply concerned about the impact of inflation on corporate profits and how it will affect US consumers. Americans’ finances are relatively strong thanks to the accumulation of savings during the pandemic, but their nest eggs are spent on high gas and food prices.
Major indices have shown a solid rise last week, supported by better-than-expected reports on corporate earnings. Lower yields in the bond market also helped, relieving pressure on equities after expectations for a rate hike by the Federal Reserve have boosted yields most of the year.
The Central bank will announce rate hike Up to three-quarters of the percentage points on Wednesday, three times more than normal. The central bank is actively campaigning to stop high inflation for 40 years. With the expected rate hike, the Fed’s benchmark rate will be in the range of 2.25% to 2.5%, the highest since 2018.
Bond yields on Tuesday were mixed. The two-year Treasury yield, which tends to move in line with Federal Reserve expectations, rose from 3.02% at the end of Monday to 3.04%. The 10-year yield, which affects mortgage rates, fell from 2.82% to 2.79%.
Technology stocks, retailers and carriers have been the biggest obstacles to the Benchmark S & P 500 Index. Microsoft was down 3.5%, Amazon was down 5.3%, and Facebook owner Meta Platforms was down 4.5%.
Losses easily outweighed the benefits of healthcare and utility stocks. Stock prices for small businesses also fell, with Russell 2000 falling 0.6%.
Investors were looking for the latest batch of corporate earnings reports.
Automaker General Motors’ share has since fallen 3.1% According to the company, profits in the second quarter fell by 40%. Over the past year, a shortage of computer chips and components has hampered factory production, reducing the company’s US sales by more than 15%.
Detroit carmakers earned $ 1.67 billion between April and June, well below the $ 2.79 billion of the previous year. GM was unable to deliver 95,000 vehicles during the quarter due to a shortage of parts.
Shopify then plummeted 15.3% A Canadian e-commerce company said it has reduced its staff by 10%. Or, considering the unexpected decrease in sales after growth due to the pandemic, about 1,000 employees.
Tech tycoons Alphabet and Microsoft will report results after Closing Bell, while Meta, Apple and Amazon will report later in the week.
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Severe news from Wal-Mart sends lower US market | Technology
Source link Severe news from Wal-Mart sends lower US market | Technology