U.S. stocks fell sharply on Wednesday after another major retailer warned of rising cost pressures, confirming the fears over inflation that have sent major benchmarks to big losses this year.
The Dow Jones Industrials tumbled 731.49 points, or 2.2%, to move into the afternoon session at 31,923.10, its first loss in four days.
The S&P 500 weakened 106.48 points, or 2.6%, to 3,982.37
The NASDAQ Composite hesitated 360.10 points, or 3%, to 11,624.42.
Those losses come after a disappointing earnings report from Target. Shares tumbled more than 24% Wednesday after Target reported first-quarter earnings that were much lower than Wall Street estimated because of higher costs for fuel and compensation. The retailer also saw lower-than-expected sales for discretionary merchandise like TVs.
Target’s report comes right after Walmart on Tuesday posted earnings that fell short of expectations as it too cited higher fuel and labour costs. Walmart shares ended Tuesday lower by 11%. They were down another 6% on Wednesday.
Other retailers took a hit on the back of Target’s quarterly earnings miss. Best Buy’s stock price dropped more than 8%, Dollar General’s fell more than 11%, and Dollar Tree’s declined more than 17%. Shares of Macy’s dropped 9%, while shares of Kohl’s fell more than 10%.
Lowe’s shares fell more than 4% after missing sales expectations in its first quarter report as shoppers bought fewer supplies for outdoor projects.
TJ Maxx-parent TJX Companies bucked the overall negative trend, with shares surging 7% after the retailer reported an earnings beat.
Treasury prices gained ground, lowering yields to 2.92% from Tuesday’s 2.99%. Treasury prices and yields move in opposite directions.
Oil prices dropped $2.37 at $110.03 U.S. a barrel.
Gold prices subtracted 90 cents to $1,818.00 U.S. an ounce.
