Walmart halts Dow's six-day rally; S&P edges higher
Reuters
Published Feb 20, 2018 01:19PM ET
Walmart halts Dow's six-day rally; S&P edges higher
By Sruthi Shankar
(Reuters) - A steep fall in Walmart shares put the skids on the blue-chip Dow's six-day winning streak, but gains in Amazon and technology stocks propped up the S&P 500 and the Nasdaq.
The world's biggest brick-and-mortar retailer (N:WMT) reported a lower-than-expected profit and posted a sharp drop in online sales growth during the holiday period. Its shares slumped 9.4 percent, on track for their biggest intraday percentage fall in more than two years.
Other retailers including Target (N:TGT), Kroger (N:KR) and Costco Wholesale (O:COST) fell between 1.3 percent and 3.7 percent, dragging the S&P consumer staples <.SPLICES> index down 1.62 percent.
"The big thing is the miss by Walmart, driven largely by its online business, and that's having investors scratching their heads," said Kim Forrest, senior equity research analyst with Fort Pitt Capital Group in Pittsburgh.
"The assumption is that we're all going to have one store and that is Amazon."
The online retailer's shares (O:AMZN) were up more than 2 percent.
At 12:47 p.m. ET, the Dow Jones Industrial Average (DJI) was down 0.34 percent at 25,133.32.
The S&P 500 (SPX) edged up 0.10 percent to trade at 2,734.86 and the Nasdaq Composite (IXIC) gained 0.74 percent to 7,293.06, with support from tech heavyweights Apple (O:AAPL), Nvidia (O:NVDA) and Microsoft (O:MSFT).
"We had a really good last week and it is just a bit of a risk down today," said Paul Norte, portfolio manager at Kings view Asset Management in Chicago.
The S&P 500 racked up its biggest weekly increase in five years last week, easing fears that a deeper market correction was taking hold after a handful of large daily losses at the start of February.
The spark for those declines was a rise in U.S. bond yields. The benchmark 10-year Treasury bond yields
Wall Street's fear gauge, the CBOE volatility index (VIX), eased to a session low of 19.95, slightly above Friday's close of 19.46, but way off the 50 points it hit during the market rout earlier this month.
The S&P technology index's (SPLRCT) 0.91 percent gain was the biggest among the 11 major S&P sectors. The index is up 6.5 percent so far this year and is the second biggest gainer after the consumer discretionary index (SPLRCD), which includes Amazon.
Home Depot (N:HD) rose 1.1 percent after the largest U.S. home improvement chain's quarterly profit beat market estimates in an improving housing market.
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Qualcomm (O:QCOM) fell 2.2 percent after the chipmaker raised its offer to buy NXP Semiconductors NV (O:NXPI) to $127.50 per share from $110. NXP shares rose 6 percent.
Declining issues outnumbered advancers on the NYSE by 1,510 to 1,374. On the Nasdaq, 1,587 issues fell and 1,296 advanced.
Written By: Reuters
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