June 4, 2023

DS Duke

Global Business In World

Retail Earnings Strong, Stocks Not so Much

3 min read
U.S. stocks took a dip on Wednesday as investors weighed a continuation of strong earnings...

U.S. stocks took a dip on Wednesday as investors weighed a continuation of strong earnings reports from big-box retailers against lingering inflation concerns.

The Dow Jones Industrials hurtled earthward 211.37 points to 35,931.05 by the closing bell. The Dow was dragged down by a sharp drop in Visa.

The S&P 500 docked 12.23 points to 4,688.67.

The NASDAQ Composite tumbled 52.28 points to 15,921.57.

The S&P 500 and NASDAQ are still higher for the week, however, while the Dow is lagging.

Retail giant Target posted beats on the top and bottom lines, but its CEO noted rising costs may have an impact on the company going forward as it plans to absorb those costs rather than pass them onto the customer. Shares slid about 4.7{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389}.

Home improvement giant Lowe’s saw shares rise 1.2{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389}, however, after the company not only topped estimates from the Street but also raised its full-year sales forecast.

And shares of TJX jumped 5.8{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} after the apparel and home retailer reported a quarterly earnings beat on the top and bottom lines as well as a same-store sales increase of 14{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} year-over-year.

Elsewhere, Tesla climbed nearly 3.2{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} as the stock continued its rebound from a 15.4{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} loss last week, when CEO Elon Musk began his Tesla stock selloff.

Microsoft saw its shares climb slightly to hit a new intraday record as investors rotated out of value stocks — financials were largely in the red and energy stocks were among the biggest laggards in the S&P — and bet on Big Tech going into the end of the year. Amazon ticked up also and Apple rose 1.6{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389}.

VISA shares slumped 4.7{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} after Amazon said it will stop accepting payments made with Visa credit cards issued in the U.K. starting next year. That change came shortly after Visa raised its interchange fees for transactions between the U.K. and European Union. Mastercard, which has also increased its U.K.-E.U. interchange fees, fell 2.8{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} with Visa.

Shares of chipmaker Nvidia are 3.1{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} lower ahead of its earnings report after the bell.

Bath & Body Works, Victoria’s Secret and Cisco Systems are also on deck.

Prices for 10-year Treasurys climbed, lowering yields to 1.59{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389} from Tuesday’s 1.64{1cd7dfeabecd92a256507009bf608c3bde4df96f09e82f3bc2c9d67cc3d41389}. Treasury prices and yields move in opposite directions.

Oil prices declined $2.25 to $78.51 U.S. a barrel.

Gold prices recovered $14.30 to $1,868.40 U.S. an ounce.

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