- Domestic stocks continued their descent as fears grew that inflation was causing consumers to further restrict their discretionary spending. At its trough, the S&P 500 Index was roughly 21% lower for the year, technically putting it in a bear market amidst mounting concerns that a recession is on the horizon. Wednesday’s 4% decline in the S&P 500 was the largest single-day pullback since June 2020.
- Several major retailers reported lower-than-expected earnings which impacted investor sentiment. Notable companies impacted include Walmart, Lowe’s, Home Depot, and Target. The latter missed analysts’ estimates by nearly one-third prompting its stock price to plummet by 25% adding to Wednesday’s market sell-off. Costco’s stock price fell as rumors circulated the retail giant may soon raise prices of some items.
- Within the S&P 500 Index, energy and healthcare stocks were higher as Pfizer’s COVID-19 booster shot was cleared by the Food and Drug Administration for use in children between 5-11 years of age. Consumer staples and consumer discretionary stocks were lower by around 8% as each sector was dragged down by the disappointing results of several retail companies.
- Value stocks led growth and small-caps beat large-caps although all segments of the market were lower.
