Walmart and Home Depot Just Put a Nail In the Bear Market
When Walmart (NYSE: WMT) cut its guidance three weeks ago, it sent shudders through the market.
The S&P 500 fell more than 1%, and investors saw it as the latest sign that the economy was slumping into a recession. After all, Walmart controls around $500 billion in annual spending in the U.S., or nearly 10% of all non-automotive retail dollars. More than any other company, Walmart has its finger on the pulse of the economy, and in addition to being the biggest retailer in the world, it's also the world's biggest private employer, giving it outsize influence over the labor market as well.
Now, just three weeks later, Walmart is painting a much different picture. The retail giant posted better-than-expected results in its second-quarter earnings report. Comparable sales came in at 6.5%, ahead of guidance at around 6%, and its operating margin was 4.5%, compared to its earlier forecast of 4.2%. Operating income also declined just 7%, compared to the forecast three weeks ago of 13% to 14%.
Source Fool.com
