Stocks fell Thursday after consumer bellwether Walmart issued weak forward guidance despite its better-than-expected fiscal fourth-quarter earnings report. The Dow Jones Industrial Average dropped more than 450 points, while the S&P 500 Index and Nasdaq Composite each fell over 0.4%.
Here's how the market settled on Thursday:
S&P 500 Index
Dow Jones Industrial Average
Nasdaq Composite Index
Dow member Walmart
The company expects net sales to grow 3% to 4% and adjusted operating income to rise between 3.5% to 5.5% on a constant currency basis in its fiscal 2025. Walmart also forecasts for full-year adjusted earnings of $2.50 to $2.60 per share, coming in below Wall Street analyst expectations.
"We've lived in a tariff environment for the last seven or eight years, and we'll do what we know how to do," CFO John David Rainey told CNBC in an interview on Thursday. "We'll work with suppliers. We'll lean into our private brand. We'll shift supply where necessary to try to take advantage of lower costs that we can then pass on to consumers."
Bank of America Global Economist Claudio Irigoyen said in a Thursday note that President Donald Trump's tariff threats should be viewed as more of an negotiation tool than permanent policy.
"We remain in the camp that believes tariffs on China will be permanent, but in the order of 10%-20% vs their pre-existing level, rather than the 60% announced during the campaign," Irigoyen wrote in a note to clients on Thursday. "On Canada and Mexico, we have been arguing that even if tariffs were to be imposed, they would not be permanent but a negotiation tool to obtain concessions on other fronts. The recent developments were in line with our baseline views."
FedWatch:
St. Louis Federal Reserve President Alberto Musalem echoed sentiment from his peers in remarks on Thursday, signaling that current economic uncertainty and risks that inflation still poses calls for interest rates to remain higher-for-longer until inflation eases further.
"Looking ahead, I expect inflation will continue to converge to the FOMC's 2% target and the labor market will remain near full employment," Musalem said in a remarks before the Economic Club on New York. "This baseline scenario requires that monetary policy remains modestly restrictive until inflation convergence is assured, at which point the policy rate can be gradually reduced toward the neutral level as convergence progresses."
Atlanta Fed President Raphael Bostic wrote in an essay posted on the central bank district's website that policymakers should remain cautious as inflation remains a key issue and the labor market is showing some signs of weakening. Bostic is not a voting member this year of the interest rate setting Federal Open Market Committee and will vote next in 2027.
Bostic noted that "this is no time for complacency," highlighting uncertainty over the Trump administration's trade and immigration policy and business leaders across districts broadly expecting tariffs to increase price pressures despite monetary policy currently being "in a good place and the economy is strong."
"In recent weeks, we've heard not only enthusiasm -- particularly from banks, about possible shifts in tax and regulatory policies -- but also widespread apprehension about future trade and immigration policy," Bostic wrote. "These crosscurrents inject still more complexity into policymaking."
