NEW YORK: The main US stock indexes hovered near two-week lows on Thursday as climbing Treasury yields dented risk appetite, while a rare quarterly sales miss from retail bellwether Walmart disappointed investors.
Walmart lost 9.2percent after missing Wall Street expectations for quarterly comparable sales as shoppers pulled back on spending in the face of rising gas prices. It weighed on the S&P 500 consumer staples index, the biggest sectoral loser, which was down 1.5percent. Rival retailers were pulled lower after Walmart’s earnings, with Albertsons and Costco down 1.3percent and 1.4percent, respectively.
“Investor sentiment wavered after the company (Walmart) held to its conservative guidance last quarter, and the slightly raised outlook may not be sufficient to restore confidence,” said Sky Canaves, principal analyst at Emarketer. Meanwhile, US Treasury Secretary Scott Bessent said he may again increase the volume of Treasury bonds the government will repurchase.
Though yields on US Treasuries dipped briefly, they were still trading higher on the day, with the 30-year yield up 3.5 basis points to 5.244percent. The benchmark 10-year bond also rose and was last at 4.700percent.
Shiraz Ahmed, founder and CEO of Sartorial Wealth, said the muted reaction in equities reflected growing investor concerns that markets were due for a pullback after their recent record rally.
Concerns over elevated oil prices stemming from the Iran conflict and increasing government debt pushed the US 30-year Treasury yield to a near-two-decade high this week, before the initial support measures announced for long-duration bonds caused it to retreat sharplyon Wednesday.
At 12:15 p.m. ET, the Dow Jones Industrial Average fell 458.35 points, or 0.86percent, to 53,004.70, the S&P 500 lost 34.23 points, or 0.44percent, to 7,673.75, and the Nasdaq Composite dropped 243.56 points, or 0.92percent, to 26,087.53.
The S&P 500 consumer discretionary sector was the biggest weight on the benchmark index, dragged by losses in Amazon and Tesla. Meanwhile, oil prices rose 2.1percent, extending gains for the fifth consecutive session due to stalled US-Iran peace talks and Middle East supply disruptions. The S&P 500 energy index rose 1.4percent and was the biggest gainer on the S&P 500.
Separately, data showed the number of Americans filing claims for unemployment benefits slipped last week, suggesting the labor market remains stable. Minutes of the US Federal Reserve’s July meeting, released on Wednesday, showed inflation concerns deepening at the central bank, with “several” policymakers ready to raise interest rates.
Among others, cryptocurrency-related companies rallied a day after US President Donald Trump called on Congress to pass a crypto bill. Bitcoin hoarder Strategy added 7percent and exchange operator Coinbase Global rose 6.2percent. Biotech company Moderna dropped nearly 20percent a day after surging nearly 177percent.