Stocks dropped; retail sales for Q2 failed to meet expectations while earnings report ends mixed
The market's winning streak was cut today after stocks fell right after the much awaited earnings report from big name retailers came in mixed.
By: Synergy Capital Asset Management Limited
.S&P 500 stepped down from record levels and cut-off its five consecutive days of setting new records. The other two indexes, the Dow and Nasdaq, also ended lower with the Dow cutting a winning streak.
Looking back, major indexes were technically keeping momentum through highlighting the Q2 corporate earnings reports showing solid economic data to keep the investors' attitude positive. Even with the geopolitical concerns in Afghanistan, as the Taliban started to overtake the country since the weekend, the market kept rising and gains are still pouring in.
The pre-existing concerns over coronavirus Delta variant that had been ignored came back haunting as they posed threat to the indexes. There is also the potential shift in policy from the Federal Reserve that causes jitters to traders.
Tuesday's market moves are the following:
- The Dow Jones Industrial Average rose to 35,264.67 after gaining 162.82 points or 0.46%.
- The S&P 500 Index moved higher by 4.40 points or 0.10% and closed at 4,436.75.
- NASDAQ Composite Index decreased to 14,788.09 after dropping by 0.49% or 72.09 points.
- U.S. 10 Year Treasury yield is up by 2.5 basis points and at 1.3420%.
- Crude is at $68.46 per barrel after recovering 2.98% or $1.98.
- Gold is currently at $1,729.70 an ounce after gaining 0.19% or $3.2 0.
Shares of Walmart, part of the Dow, dropped even after their Q2 earnings report overwhelmed all consensus estimates and even reassessed and increased its full-year guidance. A number of things have helped increase US comparable sales (gas not included) such as the e-commerce sales, stimulus check spending, and strong grocery demand.
On the other hand, Home Depot missed comparable sales estimates, with their Q2 only hitting 4.5% which was 1% lower than analyst expectations, showing slowdown in home renovations and housing market activities. The same happened with Lowe's stock, which is another home improvement giant.
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