Major U.S. stock indexes fell on Thursday, approaching two-week lows, as a surge in Treasury yields weakened investor appetite for risk. Disappointing sales figures from retail giant Walmart and rising oil prices further pressured the market.
The Dow Jones Industrial Average dropped 605.14 points, or 1.1%, to close at 52,857.91. The S&P 500 lost 0.7%, and the Nasdaq Composite declined more than 1%.
Walmart's shares fell 9% after the company missed Wall Street's expectations for comparable sales growth. Higher gasoline prices were cited as a factor limiting consumer spending, impacting the retail bellwether. The report contributed to a 1.5% decline in the S&P 500's consumer staples index, with consumer discretionary stocks also falling 1.9%.
Competitor retailers also experienced losses following Walmart's earnings report, with Albertsons down 1.5% and Costco down 2.3%.
Further weighing on the market were rising oil prices, with U.S. crude trading above $87 per barrel, its highest level since late July. Investors also faced renewed upward pressure on bond yields. This came despite a Treasury Department announcement from the previous day indicating plans to increase bond buybacks, a move intended to slow yield gains. However, yields resumed their advance on Thursday.
Treasury Secretary Scott Bessent stated that the department might increase the volume of Treasury bonds it repurchases. Yields on 30-year and 10-year Treasury bonds briefly pared gains after his comments before resuming their upward trajectory.
"There are a couple of headwinds that the markets woke up to today," said Mona Mahajan, head of investment strategy at Edward Jones. "One was a resumption in the increase in bond yields across the curve that came despite yesterday’s Treasury move…it reversed very quickly, within 24 hours."
Investors had already been monitoring consumer health due to weaker-than-expected retail sales data for July and mixed labor market reports. The disappointing Walmart figures intensified concerns about consumer resilience amid elevated gas prices and inflationary pressures.
In other market news, data indicated a slight decrease in weekly unemployment claims, suggesting continued stability in the labor market. Cryptocurrency-related companies saw gains a day after President Trump urged Congress to pass a crypto bill. Bitcoin hoarder Strategy added 6.7% and exchange operator Coinbase Global rose 7%.
Biotech company Moderna saw its shares drop nearly 23% after a significant surge the previous day. Deere, the world's largest farm-equipment manufacturer, gained 6.6% after raising its full-year net income forecast.
Coty, the owner of the CoverGirl cosmetics brand, fell nearly 8% after forecasting current-quarter earnings below expectations and withholding its annual outlook. Advance Auto Parts tumbled 26% following a weaker annual sales forecast.