Walmart Notes Consumer Spending Change
Shares in iconic US retailer Walmart cratered yesterday. The company’s stock plunged by over 7% at the open yesterday following a profit warning from the company ahead of its scheduled earnings report next month. Walmart cited soaring inflation as causing a major impact on consumer spending habits with US households focusing capital on essentials such as food and energy over higher prices items such as electrical goods or clothing.
Yesterday’s profit warning marks the second such warning in 10 weeks, reflecting the company’s deteriorating view on consumer habits. Given Walmart’s size, the company is often used as a bellwether for overall US economic expectations. With recessionary fears rising, and US rates set to take another leg up, the near-term outlook for Walmart shares looks vulnerable to further downside.
Technical Views
The sell off in Walmart shares yesterday saw price collapsing below the 129.49 level, plunging towards the 117.88 level. Price has stalled just ahead of a test of that level for now. Momentum studies have turned sharply lower, putting focus on a break of the level and a move down to fresh 2022 lows with 110.19 the next target for bears. While 117.88 holds, however, expect ranging action between there and 129.49.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.