US stock indices fell on Tuesday as retail sales fell in July and worries about a slowdown in global economic growth increased.
Still, the losses came Tuesday after the Dow Jones Industrial Average and S&P 500 closed at record highs in the previous session.
The Dow fell 420 points, or 1.2%. The S&P 500 lost 1.1% and the Nasdaq Composite lost 1.4%.
Retail sales fell 1.1% in July, a decline more than the 0.3% decline expected by Dow Jones’ polls. The Census Bureau corrected the June figure to a jump of 0.7%.
“If we look at expectations for future consumer strength, some of the lead will be diminished by the rise of the Delta variant,” said Yung-Yu Ma of BMO Wealth Management. “These challenges are not going to go away anytime soon.”
Home Depot fell more than 4% after posting second quarter results, hurting the Dow. While quarterly earnings exceeded estimates, sales in the same store rose 4.5% during the reporting period, below the consensus estimate of 5% of analysts surveyed by StreetAccount. In the United States, sales in the same stores only increased 3.4%.
Walmart stocks rose slightly and then traded near the flatline after earnings beat estimates in the second quarter. The retailer grew in the grocery sector and reported a strong start to the back-to-school season.
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Disappointing economic data from China on Monday heightened concerns about a slowdown in global growth. Chip stocks fell for a second day on Tuesday, with the iShares Semiconductor ETF down more than 2% and Nvidia about 3%. The shares of Tesla and Boeing, both of which are also heavily dependent on the growth market China, fell.
Meanwhile, technology names were trending downward. Big tech stocks, including Google parent Alphabet, Amazon, Apple and Facebook, traded in the red.
Elsewhere, health stocks saw strength, with the S&P 500 Health Care Sector making record highs. United Health, Merck, and Johnson & Johnson all acted green.
The Dow and S&P 500 closed at record highs in their fifth consecutive positive session on Monday. The move of the S&P 500 during Monday’s session marked a milestone as the benchmark index doubled from its pandemic closing low on March 23, 2020. This is the fastest doubling of the bull market since World War II, according to calculations by CNBC.
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