U.S. equities and stock exchange traded funds were on track for one of their worst days in almost a month but pared back some of the losses in the afternoon as lackluster first quarter results out of the retail space weighed on markets.
The S&P 500 Index, along with related funds including the SPDR S&P 500 ETF (NYSEArca: SPY), iShares Core S&P 500 ETF (NYSEArca: IVV) and Vanguard 500 Index (NYSEArca: VOO), were 0.3% lower Thursday.
“Any market pullback, if orderly, are healthy as long as the underlying fundamentals for the market are strong,” Matthew Peterson, chief wealth strategist at LPL Financial, told Reuters.
Consumer discretionary company shares in the S&P 500 were among the biggest losers of the day, falling 0.6% Thursday after retail giants including Macy’s (NYSE: M) and Kohl’s (NYSE: KSS) reported weak quarterly numbers – Macy’s shares plunged 15% after the retailer showed worse-than-expected slide in revenue for the first three months of the year while Kohl’s shares dropped 6.3% after saying same-store sales declined more than expected.
Technology were also under pressure after Snapchat parent Snap (NYSE: SNAP) plummeted 20% after the appmaker said Wednesday that it was struggling to maintain strong user growth, the Wall Street Journal reports.
Despite the recent setbacks, the S&P 500 is still on track to post 13% year-over-year earnings growth for the first quarter, supporting the record run in U.S. equities and easing concerns of lofty valuations.
“You have your normal first-quarter seasonal issues,” David Donabedian, chief investment officer of CIBC Atlantic Trust Private Wealth Management, said, “but generally, the first-quarter earnings season gave equities a good boost.”
For more information on the markets and U.S. Stock ETFs, visit our S&P 500 category.