- Stocks started off negative but rose modestly higher Thursday. Government data continued to show a positive economic picture even as major retailers warned of the negative drag of tariffs.
Stocks drifted higher on Thursday as investors digested a package of contradictory developments on consumer spending and foreign investment.
The S&P 500 gained 0.4%. The Dow rose 271 points, or 0.7%, while the tech-heavy Nasdaq lost 0.2%.
Earlier on Thursday, Walmart issued a warning that prices would likely rise on Trump’s tariffs against China, despite a reduction in the level of import taxes this weekend from 145% to 30%. The retailer previously pulled earnings guidance in the face of tariff uncertainty.
“The magnitude of these increases is more than any retailer can absorb,” CFO John Rainey told CNBC. Walmart’s stock fell 0.9%.
Dick’s Sporting Goods fell 14.6% after news the chain was looking to merge with Foot Locker. UnitedHealth lost 11.3% on a report that the government was investigating the insurer for possible Medicare fraud.
Government data revealed consumers ramped up spending in April to get ahead of increased tariffs, although the shopping spree is coming to an end. Fewer Americans were applying for jobless aid than expected, and wholesale inflation appeared better.
Fed Chair Jerome Powell on Thursday warned the economy could be entering a new phase with more “supply shocks” and “volatile inflation.”