The major exchanges take another nosedive after the news that retail giants Target and Walmart missed earnings as they broadly felt the impacts of increasing food prices and costs.
Image source: Wall Street Journal
Technology stocks had led a brief rebound for markets on Tuesday. Exchanges were all down Wednesday when Target reported its earnings that missed expectations due to inflation-driven rising costs and supply-chain driven cost increases, reported Wall Street Journal. Target’s stocks were down 26% and it was on trend for the worst singular day’s performance since the market crash of October 1987.
Walmart reported earnings on Tuesday that showed an increase in sales, but a heavy impact on profits due to factors that included ballooning inventory and impacts from rising food prices and costs in general. Shares of the company were down 11% on Tuesday and another 6.2% in trading so far on Wednesday.
It all reflects the growing impact and burden that consumers are feeling from inflation as some of the largest retail giants showcase the changing environment in their first-quarter earnings. As market volatility continues, investors continue to seek havens and income where they can.
“There were a lot of conversations among investors that maybe inflation for the consumer has peaked, but these companies are giving us very different signals that we are still seeing costs rise more than prices,” said Steph Wissink, an analyst for Jefferies, in an interview with Yahoo Finance.
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