US futures fell on Monday night after Walmart cut its profit forecast, sending retail shares plunging after hours.
Dow Jones Industrial Average futures fell 134 points, or 0.42%. Futures for the S&P 500 and Nasdaq 100 were down 0.31% and 0.38%, respectively.
A late announcement on Monday from Walmart, cut quarterly and full-year profit estimates Because of high food inflation, has warned investors are weighing the impact on other retail stocks. The big-box retailer says higher prices are driving consumers back to spending on general merchandise, especially apparel.
Walmart is down nearly 9% in the long-running trade and trails other retailers. Target is down 5% and Amazon is down 4%. Macy’s and Dollar General are both down 3%, while Costco is down 2%.
“Obviously they have the stuff that’s not right and they have to sell it more aggressively to get rid of that, which looks like it’s going to have a pretty big impact as a result,” said Jeremy Bryan, head portfolio manager. Senior investor at Gradient Investments, speaking in CNBC’s “Closing Bell: Overtime.”
“The question is, how does this relate to the rest of the arbitrary space?” Bryan added.
Shares in Monday’s trading session traded in a tight range, with the S&P 500 index adding 0.1%. The Dow Jones Industrial Average rose 90.75 points, or 0.3%. The tech-heavy Nasdaq Composite lagged, slipping 0.4%. All the major averages are on track for their best month of the year.
Traders are braced for the onslaught of tech earnings and huge economic data this week, as well as the outcome of the Federal Reserve meeting, which will help Wall Street navigate your expectations for the rest of the year.
VantageRock Capital’s Avery Sheffield said on CNBC’s “Closing Bell: Overtime”: “I think there’s going to be a split market.” “I think the bottom could be in certain stocks, but nowhere else. So this could really be one of the most dynamic earnings seasons we’ve seen. in a long time.”
On Tuesday, the Federal Reserve will begin its two-day policy meeting. Traders are expecting a three-quarter percentage point gain.
Coca-Cola, McDonald’s and General Motors will report earnings on Tuesday before the alarm goes off. Alphabet, Microsoft, Chipotle Mexican Grill, UPS and Enphase Energy will report after the bell.
On the economic front, traders are expecting the latest reading of the Case-Shiller Home Price Index at 9 a.m. ET. The consumer confidence report and new home sales data will be released at 10 a.m. ET.
