The stock market kicked off the holiday-shortened week on a subdued note, with stocks showing early weakness. The S&P 500 was down by 0.3% early on Tuesday, following only its second weekly loss in the last 16 weeks. Technology stocks were particularly under pressure, pulling the Nasdaq composite down by 0.8%. However, the Dow Jones Industrial Average held up better, showing a modest decline of just 0.1%. This resilience was largely attributed to Walmart, which surged 5% after reporting better-than-expected quarterly results and issuing a strong sales forecast.
Trading on Wall Street was quieter than usual at the start of the week, with the futures for both the Dow and the S&P 500 slipping by 0.3% before the opening bell. The markets were closed on Monday for President’s Day in the U.S.
Investor sentiment was influenced by recent inflation reports, which were higher than expected. This dampened hopes that the Federal Reserve would start cutting interest rates early this year. Walmart’s robust performance provided a bright spot, with its shares jumping 2.7% before the markets opened. The retail giant also announced its acquisition of smart TV maker Vizio for $2.3 billion.
Meanwhile, Home Depot saw its shares slip by about 2% after giving a cautious outlook for the year. The company cited high interest rates, which have cooled the housing market and reduced spending on home improvements by new homeowners.
In Europe, stock markets were mixed at midday, with France’s CAC 40 up by 0.3%, Germany’s DAX down by 0.1%, and Britain’s FTSE 100 gaining 0.2%.
China’s central bank made a surprise move by keeping its 1-year loan prime rate unchanged but cutting its 5-year rate by 25 basis points to 3.95%. This is the first time the five-year rate has been cut since May 2023. The move is seen as an effort to support the recovery of the property market and improve affordability for buyers by lowering mortgage rates.
Overall, benchmark indexes rose in China but fell in Tokyo, Sydney, and Seoul. Hong Kong’s Hang Seng gained 0.6%, while the Shanghai Composite rose 0.4%. Japan’s Nikkei 225 declined by 0.3%, Australia’s S&P/ASX 200 slipped by less than 0.1%, and South Korea’s Kospi lost 0.8%.
In energy trading, U.S. benchmark crude oil gave up 93 cents to trade at $77.53 a barrel, while Brent crude, the international standard, dropped 79 cents to $82.77 per barrel.
In currency markets, the U.S. dollar rose slightly against the Japanese yen, trading at 150.16 yen from 150.10 yen. The euro also edged up, costing $1.0801 compared to $1.0783.
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