Markets wobble after Russia-Ukraine tensions

Dow dropped 173 but a little above early lows, decliners over advancers 5-4 & NAZ  went up74.  The MLP index hovered in the 296s & the REIT index was up 1+ to the 423s.  Junk bond funds inched higher & Treasuries had buying which lowered yields more below).  Oil slid lower to the high 68s & gold rose 15 to 2629.

Dow Jones Industrials

Walmart (WMT), a Dow stock & Dividend Aristocrat, raised its outlook for the year after benefiting from increased spending on nonessential items & an uptick in pick-up & delivery orders.  The company, the largest US retailer & a key indicator of consumer sentiment, forecast net sales to grow 4.8-5.1%, up from its prior forecast of 3.75-4.75% sales growth.  It also continues to get a significant boost from higher earners.  "We had a strong quarter, continuing our momentum,"  CEO Doug McMillon said.  "In the U.S., in-store volumes grew, pickup from store grew faster, and delivery from store grew even faster than that."  The company reported that its 3rd-qtr revenue climbed more than 5% from the prior qtr to $169B, beating the estimate of $168B.  Adjusted EPS also beat estimates by 5¢.  In the 3-month period that ended Oct 31, sales at US stores jumped 5.3% due to "strength across merchandise categories and physical and digital channels."  The increase in discretionary spending marks a reversal of the trend seen in recent years, when inflation squeezed household budgets & forced many shoppers to focus on essential items.  For the prior 3-month period, US transactions grew 3.1% & the average ticket increased by 2.1% year over year.  The company said its also gaining more shoppers, primarily from upper-income households.   E-commerce sales rose 22% in the US, led in part by store-fulfilled pickup & delivery.  The stock

Walmart raises outlook as consumers spend more on nonessentials, order more deliveries

Lowe’s (LOW) beat quarterly earnings expectation, as outdoor do-it-yourself projects, the home professional business & stronger online shopping fueled sales.  Even with the better-than-expected results, the home improvement retailer is projecting a year-over-year sales decline.  The company updated its full-year guidance & now expects total sales of $83-83.5B, higher than its previous forecast for $82.7-83.2B.  It expects comparable sales to decline 3-3.5%, slightly better than the 3.5% to 4% drop that it had previously anticipated.  LOW's is lapping a year-ago period when the company lowered its outlook & sales tumbled nearly 13% year over year.  It also cut its full-year forecast in Aug as it predicted weak home improvement demand in the back ½ of the year because of high interest rates.  CEO Marvin Ellison said the retailer is still waiting for homeowners to tackle more projects.  Yet in the meantime, it has improved its online business, spruced up its store showrooms & made sure it offers same- & next-day shipping in almost every zip code.  “We don’t know when the inflection happens, but when it happens, we’ve been building a playbook to be prepared and positioned to get our fair share and get our unfair share of that market demand,” he added.  In the fiscal 3rd qtr, EPS fell to $2.99, compared with $3.06, in the year-ago period.  Revenue dropped from $20.5B in the year-ago qtr. adjusted EPS of $2.89 excluded gains associated with the company's sale of its Canadian retail business in 2022.  Comparable sales declined 1.1% year over year, due to weaker demand for bigger & pricier discretionary DIY projects.  That was offset, in part, by demand driven by preparation for and repairs from hurricanes Helene and Milton, along with growth in sales to home pros like contractors.  The stock

Lowe’s beats on earnings and hikes guidance, but expects sales to fall this year

Treasury yields slid as tensions between Ukraine & Russia increased.  The yield on the 10-year Treasury was lower by 5 basis points at 4.367% & the 2-year Treasury was down by 3 basis points at 4.251%.  The rise in yields came as investors flooded into the asset as a safe haven amid rising geopolitical tensions.  1 basis point is equal to 0.01% & yields & prices move in opposite directions.  Russian Pres Vladimir Putin warned the US that the threshold for the use of nuclear weapons had lowered. Under the new doctrine, Russia would consider using such weaponry if it — or allies — were met with “with the use of conventional weapons that created a critical threat to their sovereignty and (or) their territorial integrity.”  The new stance comes after Pres Biden allowed Ukraine to use US weapons to strike inside Russia.  It also follows news that Ukraine hit a Russian border city with US-made missiles.  The Russian military said in a statement that a “facility in Bryansk region at 03:25 tonight using six ballistic missiles.”  On the data front, new housing figures for Oct fell short of expectations in Oct as mortgage rates rose.  Privately owned new construction fell 3.1% from Sep & came in below the estimate for 1.34M.  Building permits also slipped 0.6% month over month & 7.7% from a year ago.  On building permits, the total of 1.42M represented a 0.6% monthly decline & missed the forecast for 1.43M.  Permits declined 7.7% from a year ago.

Treasury yields fall amid rising Ukraine-Russia tensions

US stocks recovered from steeper losses today as fears over a nuclear escalation in the Russia-Ukraine war rattled financial markets.