U.S. equities and stock exchange traded funds were mixed Tuesday after a round of lackluster earnings out of the retail segment dragged on equities.
“Equities are headed towards pause mode,” Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, told Reuters. “There continues to be concerns over geopolitics, valuations, interest rates and perhaps to a degree, seasonal fatigue.”
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 0.1% higher Tuesday.
Meanwhile, retail companies dragged on the consumer segment, with consumer discretionary names in the S&P 500 down 0.7% Tuesday.
Shares of Dick’s Sporting Goods (NYSE: DKS) declined over 19% after same-store sales didn’t meet expectations in the latest quarter and the company also lowered forecasts for annual earnings, the Wall Street Journal reports.
Traditional brick-and-mortar stores have been suffering in the digital age as rising competition from e-commerce outlets, like Amazon (NasdaqGS: AMZN), have cut into profits.
The Commerce Department revealed that sales at retailers and restaurants was 0.6% higher in July, the biggest rise since December due to an increase in internet sales.
“The source of the retail sales is still the non big-box stores,” Tom Stringfellow, chief investment officer of Frost Investments, told the WSJ. “It’s the internet, not the Home Depots or the Macys. It’s Amazon Prime.”
Related: U.S. Stock ETFs Shrug Off North Korea Concerns
Dan Miller, director of equities at GW&K Investment Management, also argued that global markets remain resilient and upbeat, and the North Korea-U.S. spat was only a short-term event.
“The stock market should continue on its merry way. Things like North Korea or events in Virginia over the weekend, the market tends to look past those events,” Miller told the WSJ.
North Korean leader Kim Jong Un delayed a decision on firing missiles towards Guam, waiting to see what the U.S. does. Observers saw this posturing as another move straight out of Pyongyang’s playbook that should not surprise anyone.
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