U.S. Stocks Open Lower After Target Warning Sends Shockwaves Across Retail -Breaking
By Liz Moyer
Investing.com — U.S. stocks closed lower Tuesday due to concerns about the retail sector.
The ET time was 9:47 am ET. It was down by 198 points, or 0.6%. Meanwhile, 0.6% was lower and 0.6% was higher.
Target Corporation stock dropped 6% on the news that the retailer had warned about lower margins. The company said it needs to reduce its inventory, cancelling orders and offering huge discounts. The retailer is clearing excess stock to allow for high-demand items, like food and cosmetics.
The warning was a surprise to the entire retail industry. Walmart Inc. (NYSE:), shares fell 2.5% and Amazon.com Inc. (NASDAQ:) dropped 2.5%. In recent weeks, retail earnings were mixed. Investors scanned them to see if there was a possibility of a recession based on consumer spending patterns. People were still stocking basic household supplies at the time of the pandemic. This has been replaced by spending on experiences and travel, while people are reducing discretionary household purchases due to rising fuel and food prices.
The operator of department stores Kohls Corp After disclosing advance takeover negotiations with Retail Holding Company Franchise Group (NASDAQ):, which holds retail brands like the Vitamin Shoppe, shares of (NYSE::) rose by 7%
JM Smucker Company shares rose 3.8% following better-than expected quarterly results. However, the manufacturer of jelly and jams said that inflation and supply-chain issues will continue to have an impact on results.
The oil price rose. Oil rose 0.3% to $118.92 per barrel and 0.4% to $120 per barrel. up 0.3%, to $18,848 per ounce.