Stock Market Today: Dow Rides Rally in Retailers to Close Above 34,000
2022.08.16 23:26
By Yasin Ebrahim
Investing.com — The Dow closed above 34,000 Tuesday for the first time since May, led by a jump in retailers as better-than-expected results from Walmart and Home Depot pointed to strength in the consumer.
The Dow Jones Industrial Average was up 0.71%, or 239 points, the Nasdaq Composite fell 0.19% and the S&P 500 was up 0.19%.
Walmart Inc (NYSE:WMT) reported second-quarter results that beat recently lowered estimates and forecast earnings to fall less than expected following the retailer’s recent profit warning. Its shares jumped more than 5%.
The retailer said it now expected adjusted earnings per share to decline 9% to 11%, revised from previous outlook of 11% to 13%.
Home Depot Inc (NYSE:HD) also reported quarterly results that topped Wall Street estimates and the home improvement retailer maintained full-year guidance amid “continued strength in demand for home improvement projects.” Its shares also climbed 4%.
The duo of better-than-expected results triggered a wave of green in other retailers also, with Bath & Body Works Inc. (NYSE:BBWI), Target Corporation (NYSE:TGT) and Best Buy (NYSE:BBY) in the ascendency.
Financials were pushed higher by a rise in regional bank stocks as Treasury yields continue to steady on easing worries about steep U.S. recession.
Regions Financial Corporation (NYSE:RF), SVB Financial (NASDAQ:SIVB), Bank of America Corp (NYSE:BAC) were up more than 1%, while Ally Financial Inc (NYSE:ALLY) jumped more than 4% after Warren Buffett’s Berkshire Hathaway revealed, in a regulatory filing, it had tripled its stake in the online bank during Q2.
Tech cut some losses, but weakness in semiconductor stocks weighed as Citi’s latest view on the sector continued to flag declines in notebook shipments and said weaker PC demand will continue to impact growth.
Citi reiterated its neutral ratings on Intel (NASDAQ:INTC) and Advanced Micro Devices (NASDAQ:AMD), with the latter trading slightly in the red.
Energy was one of the few sectors in the red, pressured by an ongoing slide in oil prices as traders weigh the outcome of talks to revive the Iranian nuclear deal that could lift sanctions on Tehran, paving the way for a fresh supply of crude.
Big tech, meanwhile, traded mostly lower as Apple (NASDAQ:AAPL) flirted with gains and losses, while Meta Platforms Inc (NASDAQ:META) fell nearly 1%
Growth sectors of the market such as tech and consumer discretionary are up nearly 30% since mid-June, fueling optimism that the broader market is in the process of V-shape rebound to wipe out its losses this year. “As inflation data weakness and economic data softens that will make the Fed’s job easier […] in the second half of the year, we’re going to get a lot of price-to-earnings expansion, making all-time highs is possible,” Fundstrat Global Advisors’ Tom Lee told CNBC on Monday.
Others, however, suggest, the market is likely to remain range bound amid ongoing monetary policy and inflation uncertainty.
“I don’t think we’re in a V shape recovery. I think you’re gonna see the market around a trading range for a while until there’s more clarity with inflation, and fed monetary policy,” Robert Conzo, CEO of The Wealth Alliance, told Investing.com in an interview on Tuesday.
