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Dow Edges Up On Retail Earnings Boost
Despite a rough start to the year on fears of surging prices and rising rates tipping the US economy into a recession, Wall Street indexes have recovered some of their sharp losses in the recent weeks on signs that inflation has peaked
Photo Credit : REUTERS/Andrew Kelly
The Dow inched higher on Tuesday as results from Walmart and Home Depot lifted the retail sector, while a slide in megacap growth stocks and signs of a slowing global economy weighed on the Nasdaq and the S&P 500.
Boosting the blue-chip Dow, Walmart Inc rose 5.3 per cent as the world's largest retailer forecast a smaller drop in full-year profit than previously projected.
The S&P 500 retail sector gained 0.5 per cent in early trading.
Home Depot Inc added 1.7 per cent as it surpassed estimates for quarterly sales after demand from builders and higher prices helped the biggest home-improvement chain cushion the hit from dwindling store visits.
"The consumer seems to be holding up, even though we continue to have inflation," said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh.
"The price of gasoline has come down and especially for lower-income shoppers, that takes a lot of their spending."
Many high-growth and technology stocks edged lower as US Treasury yields snapped their two-day slump.
Apple Inc and Nvidia Corp fell 0.4 per cent and 1.1 per cent, respectively, as the 10-year Treasury yield rose to 2.85 per cent.
Despite a rough start to the year on fears of surging prices and rising rates tipping the US economy into a recession, Wall Street indexes have recovered some of their sharp losses in the recent weeks on signs that inflation has peaked.
The tech-heavy Nasdaq index has bounced nearly 24 per cent off its mid-June lows.
Investor sentiment is still bearish, but no longer "apocalyptically" so, according to BofA's monthly survey of global fund managers in August.
At 09:41 a.m. ET, the Dow Jones Industrial Average (.DJI) was up 26.85 points, or 0.08 per cent, at 33,939.29, the S&P 500 was down 5.77 points, or 0.13 per cent, at 4,291.37, and the Nasdaq Composite (.IXIC) was down 55.16 points, or 0.42 per cent, at 13,072.89.
Better-than-expected earnings from corporate America have been a bright spot for US equities recently, with 77.6 per cent of the S&P 500 companies that have reported results as of Friday beating analysts' estimates, according to Refinitiv data.
Focus will be on retail earnings and retail sales data this week for more clues on the impact of inflation on consumer behavior.
Declining issues outnumbered advancers for a 1.41-to-1 ratio on the NYSE and a 1.84-to-1 ratio on the Nasdaq.
The S&P index recorded five new 52-week highs and 29 new lows, while the Nasdaq recorded 24 new highs and 12 new lows.