Stock futures were mostly flat on Wednesday morning after two of the country’s big fund chains, Walmart and Home Depot, pushed the Dow and S&P 500 higher and set the stage for more retail profits this week.
Futures linked to the Dow Jones Industrial Average were down 17 points, or 0.05%. S&P 500 and Nasdaq 100 futures are down 0.09% and 0.17%, respectively.
In regular trading, the Dow ended the day 239 points, or 0.7%, and the S&P up 0.2%. The Nasdaq Composite Index fell 0.2%.
Retailers led the market higher thanks to strong quarterly results from Walmart and Home Depot, which were the top gainers in the Dow’s 30-share index, dragging others like Target, Best Buy and Bath & Body Works with them.
The Dow Jones index gained for the fifth consecutive day. In the meantime, the S&P 500 is heading for its fifth consecutive week as investors continue to gauge the strength of the rally. The broad market index is now up 18% from its June lows.
“This market has been very resilient,” Brian Talkington, managing partner at Requisite Capital Management, said on CNBC’s “Closing Bell: Overtime.” “As we get closer to making profits, it will outpace profits by an average of about 7%.”
What gives it “a significant amount of pause” in this market is the Federal Reserve and its plans to continue raising interest rates and shrinking the size of its balance sheet. “Gains are still solid, but … the Fed’s balance sheet hasn’t budged,” she said.
Gabriela Santos, global market analyst at JP Morgan Asset Management, agreed that investors need to be alert for more volatility to come.
“Real yields are set to increase in the fall, which could put pressure on growth stocks again,” she said. “[With] The macro story that took hold recently and led to more broad-based gains in the market – it’s too early to have any kind of conviction that we really know what inflation will look like next fall or next year, or that we know how the Fed will react to that inflation “.
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