Stock Market News for Aug 16, 2019

Markets were lower during the beginning of the trading session on Aug 15, following China’s comments of taking retaliatory measures against Trump’s tariffs threat. But the Dow Jones and S&P 500 ended in the green, banking on Walmart’s WMT stellar quarterly earnings report and July’s impressive retail sales data. The tech-laden Nasdaq, however, closed in the red.

The Dow Jones Industrial Average climbed 0.4% to close at 25,579.39 on Aug 16. The broader S&P 500 followed suit, rising 0.3% to finish at 2,847.60. The Nasdaq Composite closed at 7,766.62 after dropping 0.1%. The fear-gauge CBOE Volatility Index (VIX) slumped 4.2% to close at 21.18. Lastly, advancers outnumbered decliners on the NYSE by a 1.48-to-1 ratio.

Walmart’s Q2 Report Shines

On Aug 15, Walmart reported earnings of $1.27 per share, which beat the Zacks Consensus Estimate by 4.1%. The company’s revenue for the quarter ended June 30 gained 1.8% to reach $130.38 billion, which was notable as well. (Read more)

The retail giant’s strong earnings and revenue growth in Q2 is attributed to its efforts in growing its U.S. business, online operations and investments in grocery. Walmart carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Remarkable Retail Sales in July

Per a U.S. Department of Commerce report, U.S. retail and food services sales for July rose 0.7% from June. Americans didn’t cut back on their retail activities despite economic headwinds and trade-related tensions building up.

Sales were even greater at 0.9%, if auto dealers and gasoline stations aren’t taken into consideration. In addition, sales climbed to 2.8% for e-commerce retailers, which could have been because of Amazon’s AMZN Prime Day sales. Major reasons behind retail sales shooting up were wage growth and notable new job additions last month.

U.S.-China Trade Issue Shows Little Progress

On Aug 15, the U.S.-China trade war took a turn for the worse after China said it will take all "necessary counter-measures" that would fit President Donald Trump’s recent threat to impose a 10% tariff on the rest of Chinese exports to the United States.

China's Customs Tariff Commission of the State Council said that the China feels "severely violated" by Trump’s new resolution, which deviates from an agreement reached during the G-20 summit. The Asian country said it hopes to “meet the U.S. halfway” to reach a "mutually acceptable solutions through dialogue on the basis of equality and mutual respect."

Earlier in August, Trump had threatened to slap duties on $300 billion worth of Chinese goods, to be put in place from Sept 1. However, earlier this week, the Trump administration took few items off that list and delayed some additional tariffs to December. The two countries are expected to discuss trade issues again in two weeks.

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