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U.S. stocks closed higher for the second straight day on Tuesday, led by a rally in tech and energy stocks. However, the retail sector came under pressure after one of the top retail giants issued warning about excess inventories that could impact its current quarter profits. All the major indexes ended in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gained 0.8% or 264.36 points to finish at 33,180.14 points.
The S&P 500 climbed 1% or 39.25 points to end at 4,160.68.43 points. Almost all the sectors performed well.
The Energy Select Sector SPDR (XLE) gained 3%. The Industrials Select Sector SPDR (XLI) and the Health Care Select Sector SPDR (XLV) each gained 1.3%. The Technology Select Sector SPDR (XLK) added 1.2%. Ten of the 11 sectors of the benchmark index ended in positive territory.
The tech-heavy Nasdaq rose 0.9% or 113.86 points to close at 12,175.23 points.
The fear-gauge CBOE Volatility Index (VIX) was down 4.19% to 24.02. Advancers outnumbered decliners on the NYSE by a 2.36-to-1 ratio. On Nasdaq, a 1.69-to-1 ratio favored advancing issues. A total of 10.38 billion shares were traded on Tuesday, lower than the last 20-session average of 12.50 billion.
Retail Stocks Come Under Pressure
Markets gave up almost all the day’s gain on Monday and managed to somehow finish in the red. However, stocks rallied on Tuesday despite the retail sector coming under pressure.
On Tuesday, retail giant Target Corporation (TGT - Free Report) issued a warning about excess inventories and how that could impact its current quarter’s profits. The retailer announced its plans on how to cut down excess inventories which include markdowns and discounts. Target said that it will cancel the same orders, offer products at higher discounted prices and trim stocks of discretionary items.
The announcement from Target immediately put pressure on other retail stocks. Shares of Walmart Inc. (WMT - Free Report) declined 1.2%, while Amazon.com, Inc. (AMZN - Free Report) declined 1.4%. Several retailers have reported mixed earnings in their last quarterly reports and cited rising fuel cost as a major challenge as it is pushing transportation costs. This has seen retail stocks taking a beating lately.
Tech Stocks Rally
Tech and energy stocks rallied on Tuesday in a choppy trading session that saw the 10-year Treasury yield almost touch the 3% mark. Treasury yields have been on the rise since the beginning of this year, which has been creating pressure on high-growth tech stocks. However, it fell 6.8 basis points on Tuesday to 2.969%.
The Commerce Department said on Tuesday that U.S. trade deficit eased to its lowest level in over nine years as exports hit a record high. U.S. trade deficit declined 19.1% in April to $87.1 billion, its lowest level since December 2012. The trade deficit for March was revised to a record high of $107.07 billion from the initially reported figures of $109.08 billion.
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Stock Market News for Jun 8, 2022
U.S. stocks closed higher for the second straight day on Tuesday, led by a rally in tech and energy stocks. However, the retail sector came under pressure after one of the top retail giants issued warning about excess inventories that could impact its current quarter profits. All the major indexes ended in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gained 0.8% or 264.36 points to finish at 33,180.14 points.
The S&P 500 climbed 1% or 39.25 points to end at 4,160.68.43 points. Almost all the sectors performed well.
The Energy Select Sector SPDR (XLE) gained 3%. The Industrials Select Sector SPDR (XLI) and the Health Care Select Sector SPDR (XLV) each gained 1.3%. The Technology Select Sector SPDR (XLK) added 1.2%. Ten of the 11 sectors of the benchmark index ended in positive territory.
The tech-heavy Nasdaq rose 0.9% or 113.86 points to close at 12,175.23 points.
The fear-gauge CBOE Volatility Index (VIX) was down 4.19% to 24.02. Advancers outnumbered decliners on the NYSE by a 2.36-to-1 ratio. On Nasdaq, a 1.69-to-1 ratio favored advancing issues. A total of 10.38 billion shares were traded on Tuesday, lower than the last 20-session average of 12.50 billion.
Retail Stocks Come Under Pressure
Markets gave up almost all the day’s gain on Monday and managed to somehow finish in the red. However, stocks rallied on Tuesday despite the retail sector coming under pressure.
On Tuesday, retail giant Target Corporation (TGT - Free Report) issued a warning about excess inventories and how that could impact its current quarter’s profits. The retailer announced its plans on how to cut down excess inventories which include markdowns and discounts. Target said that it will cancel the same orders, offer products at higher discounted prices and trim stocks of discretionary items.
Following this, shares of Target plummeted. However, it pared some of the losses by the end of the day to close 2.3% lower. Target has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
The announcement from Target immediately put pressure on other retail stocks. Shares of Walmart Inc. (WMT - Free Report) declined 1.2%, while Amazon.com, Inc. (AMZN - Free Report) declined 1.4%. Several retailers have reported mixed earnings in their last quarterly reports and cited rising fuel cost as a major challenge as it is pushing transportation costs. This has seen retail stocks taking a beating lately.
Tech Stocks Rally
Tech and energy stocks rallied on Tuesday in a choppy trading session that saw the 10-year Treasury yield almost touch the 3% mark. Treasury yields have been on the rise since the beginning of this year, which has been creating pressure on high-growth tech stocks. However, it fell 6.8 basis points on Tuesday to 2.969%.
Shares of Apple, Inc. (AAPL - Free Report) gained 1.8%, while Salesforce, Inc. (CRM - Free Report) rallied 2.3%.
Economic Data
The Commerce Department said on Tuesday that U.S. trade deficit eased to its lowest level in over nine years as exports hit a record high. U.S. trade deficit declined 19.1% in April to $87.1 billion, its lowest level since December 2012. The trade deficit for March was revised to a record high of $107.07 billion from the initially reported figures of $109.08 billion.