Following the mixed performance seen in the previous session, stocks have moved mostly lower in morning trading on Tuesday. The major averages have all moved to the downside, with the tech-heavy Nasdaq showing a notable drop.
In recent trading, the Nasdaq and the S&P 500 have fallen to new lows for the session. The Nasdaq is down 167.54 points or 1.4 percent at 11,615.13, the S&P 500 is down 31.69 points or 0.8 percent at 3,935.15 and the Dow is down 103.11 points or 0.3 percent at 31,886.93.
A steep drop by shares of Walmart (WMT) is weighing on the markets, with the retail giant plunging by 8.6 percent to its lowest intraday level in almost a month.
Walmart is under pressure after lowering its guidance for the second quarter and full year primarily due to pricing actions aimed to improve inventory levels.
Auto giant General Motors (GM) has also moved to the downside after reporting second quarter earnings that missed analyst estimates.
Meanwhile, a strong gain by 3M (MMM) is limiting the downside for the Dow, with the conglomerate jumping by 5.8 percent after reporting better than expected second quarter results and announcing plans to spin off its health care business.
Shares of General Electric (GE) have also surged after the conglomerate reported second quarter results that exceeded expectations on both the top and bottom lines.
The weakness on Wall Street also comes as traders look ahead to the Federal Reserve’s monetary policy announcement on Wednesday.
The Fed is widely expected to announce another 75 basis point rate hike as part of its efforts to combat elevated inflation.
In U.S. economic news, the Commerce Department released a report showing new home sales pullback by more than expected in the month of June.
The report said new home sales plunged by 8.1 percent to an annual rate of 590,000 in June after jumping by 6.3 percent to a revised rate of 642,000 in May.
Economists had expected new home sales to tumble by 5.2 percent to an annual rate of 660,000 from the 696,000 originally reported for the previous month.
With the bigger than expected decrease, new home sales slumped to their lowest annual rate since hitting 582,000 in April 2020.
A separate report released by the Conference Board showed consumer confidence in the U.S. deteriorated by more than expected in the month of July.
The Conference Board said its consumer confidence index slid to 95.7 in July from a downwardly revised 98.4 in June. Economists had expected the index to drop to 96.8 from the 98.7 originally reported for the previous month.
Retail stocks are seeing substantial weakness following the warning from Walmart, dragging the Dow Jones U.S. Retail Index down by 3.4 percent.
The index continues to give back ground after ending last Thursday’s trading at its best closing level in well over two months.
Significant weakness is also visible among airline stocks, as reflected by the 2.1 percent slump by the NYSE Arca Airline Index.
Tobacco, brokerage and chemical stocks are also seeing considerable weakness on the day, while gold stocks are bucking the downtrend amid a modest increase by the price of the precious metal.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan’s Nikkei 225 Index edged down by 0.2 percent, while China’s Shanghai Composite Index advanced by 0.8 percent.
Meanwhile, European stocks have moved mostly lower on the day. While the U.K.’s FTSE 100 Index is nearly unchanged, the French CAC 40 Index is down by 0.6 percent and the German DAX Index is down by 0.8 percent.
In the bond market, treasuries have moved notably higher following the pullback seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 7.7 basis points to 2.743 percent.
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