Midday Update: Washington and Walmart Weigh on Wall Street

Midday Update: Washington and Walmart Weigh on Wall Street

Weighed down by soft sales for Walmart’s ( WMT ) Sam’s Club segment and the continued fall-out from President Trump’s decision to pull the plug on his advisory councils, stocks are trading significantly lower on Thursday with technology stocks taking the brunt of today’s selling pressure following disappointing results from Cisco ( CSCO ).

Wall Street was defensive before the cash market open as Wednesday’s events in Washington coupled with the Federal Reserve’s concerns surrounding inflation continued to reverberate. And although Walmart’s Q2 results topped expectations, investors were spooked by sluggish sales in its Sam’s Club division and in-line guidance for FY18 and Q3 resulting in deep losses for the retail sector.

Selling pressure accelerated mid-morning following rumors that Trump’s chief economic advisor, Gary Cohn, was resigning over the president’s tepid condemnation of white supremacists, driving down the major market averages, the dollar and shares of Dow component stock Goldman Sachs ( GS ).

However, an unnamed White House official said that “Nothing has changed. Gary is focused on his responsibilities as NEC Director and any reports to the contrary are 100% false.”

Losses in shares of component stocks Goldman Sachs, Cisco, Apple ( AAPL ) and Walmart are responsible for more than 50 points off the blue chip index.

Economic data was mixed. Initial jobless claims were down a much greater-than-expected 12,000 for the week ended August 12 to 232,000 vs 240,000 estimates.

The Philadelphia Fed manufacturing index dropped to its lowest level since Nov 2016 of 18.9 from 19.5 in July, but was above expectations of 17.0.

Led by a sizable drop in automobile production, industrial production increased by just 0.2% in July, while capacity utilization was unchanged at 76.7%.

Finally, leading economic indicators rose 0.3% in July, in-line with forecasts.

In sympathy with weakness in the U.S. and roiled by a possible terrorist attack in Barcelona, EU bourses are all lower, led by losses in the banking sector after the FOMC minutes lowered the odds for a December rate hike.

Crude oil was up $0.19 to $46.96 per barrel. Natural gas was up $0.03 to $2.95 per 1 million BTU. Gold was up $8.20 to $1,291.10 an ounce, while silver was up $0.10 to $17.03 an ounce. Copper was down $0.01 to $2.94 per pound.

Among energy ETFs, the United States Oil Fund was up 0.51% to $9.62 with the United States Natural Gas Fund was up 1.16% to $6.57. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was down 0.09% to 23.06 while SPDR Gold Shares were up 0.28% to $122.21. The iShares Silver Trust was down 0.25% to $16.11.

Here’s where the markets stand at mid-day:

US MARKETS

NYSE Composite Index was down 67.90 points (-0.57%) to 11,800.95

Dow Jones Industrial Index was down 144.33 points (-0.66%) to 21,880.54

S&P 500 was down 19.51 points (-0.79%) to 2,448.60

Nasdaq Composite Index was down 67.56 points (-1.06%) to 6,277.55

GLOBAL SENTIMENT

FTSE 100 was down 45.16 points (-0.61%) to 7,387.87

DAX was down 60.40 points (-0.49%) to 12,203.46

CAC 40 was down 29.76 points (-0.57%) to 5,146.85

Nikkei 225 was down 26.65 points (-0.14%) to 19,702.63

Hang Seng Index was down 64.85 points (-0.24%) to 27,344.22

Shanghai China Composite Index was up 21.98 points (+0.68%) to 3,268.43

NYSE SECTOR INDICES

NYSE Energy Sector Index was down 51.36 points (-0.52%) to 9,847.82

NYSE Financial Sector Index was down 54.85 points (-0.72%) to 7,545.32w

NYSE Healthcare Sector Index was down 47.54 points (-0.35%) to 13,506.26

UPSIDE MOVERS

(+) SSI (+29.80%) Beat Q2 sales estimates, raised FY17 guidance

(+) DCTH (+23.62%) Ayrton Capital sold stake in company

(+) MYOV (+19.94%) Initiated at outperform at Evercore ISI Group

(+) SDLP (+17.60%) Seadrill ( SDRL ) Completes amendments to certain credit facilities that will insulate Seadrill Partners from restructuring

DOWNSIDE MOVERS

(-) NLST (-29.17%) To sell shares in an underwritten offering

(-) BGG (-12.91%) Fiscal Q4 results lag street estimates, sets FY18 guidance below expectations

(-) ROKA (-12.73%) Sells assets to Institute for Environmental Health Subsidiary

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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