NEW YORK: Wall Street stocks fell early Tuesday after an earnings warning from Walmart exacerbated recession worries on the eve of a key Federal Reserve decision.
The world’s biggest retailer trimmed its profit forecast to reflect increased consumer spending for food, gasoline and other staples that is depressing demand for goods with higher profit margins.
Shares of Walmart, a Dow component, plunged 8.5 percent in early trading, overshadowing a heavy day of other earnings.
Meanwhile, the Fed was set to start a two-day monetary policy meeting expected to result in another hefty interest rate hike. Analysts fear the hikes could depress consumer activity.
About 45 minutes into trading, the Dow Jones Industrial Average was down 0.3 percent at 31,882.94.
The broad-based S&P 500 fell 0.7 percent to 3,940.11, while the tech-rich Nasdaq Composite Index tumbled 1.2 percent to 11,646.01.
Among other companies reporting results, Coca-Cola gained 2.2 percent; General Electric won 5.4 percent; General Motors fell 3.7 percent; McDonald’s gained 1.8 percent; and UPS shed 3.3 percent.
In other news, the International Monetary Fund downgraded its economic outlook for this year and next due to accelerating inflation and the sharp slowdowns in China and the United States.
In its latest World Economic Outlook, the IMF cut the 2022 global GDP estimate to 3.2 percent, four-tenths of a point lower than the April forecast, and about half the rate seen last year.