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US stocks pulled back on Thursday as investors weighed Walmart's (WMT) tariff-clouded earnings and digested retail sales and wholesale inflation data for further clues to the health of the economy.
The S&P 500 (^GSPC) dropped roughly 0.4%, while the Dow Jones Industrial Average (^DJI) slid 0.5%. The Nasdaq Composite (^IXIC) sank about 0.6%, coming off a sixth upbeat session for tech stocks in a row.
Markets are on watch for the next catalyst now that US-China trade-truce euphoria has faded. On Thursday, in the latest development, President Trump said India has offered to "literally charge us no tariffs" on US goods to help clinch a trade deal.
But corporate statements and economic data continued painting a different reality: In its quarterly results, Walmart said its prices will rise as it can't avoid passing on the high costs of tariffs to customers.
Read more: The latest on Trump's tariffs
Meanwhile, retail sales slowed sharply in April, barely rising in a sharp reversal from American consumers' pre-tariff spending burst in March.
But wholesale inflation unexpectedly slowed last month, even as many of Trump's tariffs began coming into effect. The Producer Price Index fell 0.5% in April and rose at a 2.4% annual clip. The Consumer Price Index (CPI) update this week showed inflation pressures easing to four-year lows.
Federal Reserve policymakers have stressed that they are watching for incoming data to provide a clearer picture of the state of the economy. Fed Chair Jerome Powell on Thursday again warned of broad economic "uncertainty," saying the US economy may be entering a period with more frequent "supply shocks" and volatile inflation.
Meanwhile, oil tumbled after Trump said the US is "close to maybe doing a deal" with Iran over its nuclear program. Brent crude futures, the global benchmark, fell to below $64 a barrel, while West Texas Intermediate crude changed hands below $61.
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S&P 500 on pace to snap 3-day rally
Stocks fell on Thursday as investors assessed retail sales data and commentary from consumer-facing giant Walmart (WMT)
The S&P 500 (^GSPC) dropped roughly 0.5%, on pace to snap a three day winning streak. The Dow Jones Industrial Average (^DJI) slid 0.5%.
The Nasdaq Composite (^IXIC) dropped about 0.6%, with tech stocks sliding.
Retailer Walmart (WMT) reported mixed earnings and said it would hike prices to navigate President Trump's tariffs.
Retail sales slowed in April as Trump's tariffs weighed on US consumers.
Fed's Powell says US may be entering period of more frequent and persistent 'supply shocks'
Yahoo Finance's Jennifer Schonberger reports:
Read more here.
Retail sales slow sharply in April as pre-tariff spending burst reverses
Retail sales slowed in April as Trump's tariffs weighed on US consumers who pulled forward spending on some key categories into March ahead of these levies.
Headline retail sales rose 0.1% in April, slightly above economists expectations for sales to be flat month-on-month, and well below the 1.7% increase seen in March, according to Census Bureau data.
The control group in Thursday's release, which excludes several volatile categories and factors into the gross domestic product (GDP) reading for the quarter, fell 0.2%; control group sales had risen 0.5% in March. Economists expected a 0.3% increase.
March sales excluding auto and gas rose 0.2%, below consensus estimates for a 0.3% increase and a move lower from the 1.1% increase seen the month prior.
Walmart says it will hike prices due to tariffs
Walmart (WMT) shares rose about 2% premarket after the company reported mixed earnings and said it would hike prices to navigate President Trump's tariffs.
America's largest retailer has been seen as well-positioned to weather tariffs, as around 60% of its sales are in groceries, Yahoo Finance's Brooke DiPalma reported. Its size also means it has leverage to negotiate with suppliers to keep prices low.
However, Walmart announced it would raise some of its prices due to tariffs.
"We will do our best to keep our prices as low as possible," Walmart CEO Doug McMillon said in the release. "But given the magnitude of the tariffs, even at the reduced levels announced this week, we aren’t able to absorb all the pressure given the reality of narrow retail margins."
Walmart's US same-store sales beat expectations with a 4.5% increase in the first quarter, led by strength in health and wellness and groceries. Here's what the bellwether for retail reported on the top and bottom lines:
Walmart reiterated its conservative financial guidance for the year. It projected net sales to increase between 3% and 4%.
Alibaba stock falls after quarterly revenue miss
Alibaba (BABA) stock dropped 5% before the bell on Thursday after missing quarterly revenue estimates as it adjusts strategies amid economic and trade challenges.
Reuters reports:
CoreWeave slides as investors weigh $23 billion spending spree
Shares in CoreWeave sank as much as 8% after the AI data center provider's plans for capital expenditure outstripped Wall Street forecasts.
Yahoo Finance's Laura Bratton reports:
Good morning. Here's what's happening today.
Foot Locker stock rockets 80% in wake of Dick's $2.4B deal
Dick's Sporting Goods (DKS) has agreed to buy Foot Locker (FL) for roughly $2.4 billion, the companies said on Thursday, confirming an earlier report of the deal by The Wall Street Journal.
Shares in Foot Locker surged over 80% in premarket, taking another leg higher from after-hours gains on the confirmation of The Wall Street Journal's earlier report of the deal.
Big box retailer Dick's is offering $24 apiece for shares of its smaller footwear rival, a premium of 86% on the stock's closing price on Wednesday, per Reuters.
Dick's stock dropped almost 9% before the bell as investors assessed the move, which comes as President Trump's tariffs pose supply risks and uncertainty for retailers.
The Associated Press reported:
UnitedHealth stock slides as report of criminal investigation adds to woes
Shares of beleaguered UnitedHealth (UNH) sank almost 7% in premarket trading after a report that US prosecutors are probing the company over possible Medicare fraud.
The Department of Justice is carrying out a criminal investigation into the health insurer, The Wall Street Journal reported on Wednesday.
UnitedHealth told Reuters that it has not been notified by the DOJ about the reported investigation. The outlet reports:
Cisco stock jumps as AI demand lifts annual forecast
Cisco Systems (CSCO) stock rose 4% before the bell on Thursday after its finance chief Scott Herren announced retirement from the company in July, and raised its annual results forecast.
Reuters reports:
Japanese investors continue mammoth run of foreign stock spend
Japanese investors have logged eight consecutive weeks of heavy investment in foreign stocks. US tariff fears failing to stop high Yen spend, with momentum in trade talks only ramping up investment.
Reuters reports:
Read more here.
Crude oil drops over $1 as stockpiles rise
US crude oil futures dropped over $1 as a rise in US stockpiles led to oversupply fears.
Brent Crude (BZ=F) sunk by $1.32 or 2% by late evening on Wednesday.
Reuters reports:
