Stocks claw back after 800 point Dow loss
U.S. stocks are trading higher on Thursday, getting a boost fom the retail sector.
Walmart shares traded higher after reporting that second-quarter U.S. comparable sales topped expectations and the retailer boosted its earnings forecast for the year.
Also U.S. retail sales jumped in July as various goods were purchased. The Commerce Department said retail sales rose 0.7 percent.
|I:DJI||DOW JONES AVERAGES||25445.25||-34.17||-0.13%|
|I:COMP||NASDAQ COMPOSITE INDEX||7783.109684||+9.17||+0.12%|
Stocks went on a rollercoaster ride in the premarket session, bouncing between gains and losses as China threatened retaliation if Washington goes ahead with planned Sept. 1 tariff hikes.
The Chinese announcement did not mention President Trump’s decision this week to delay penalties until December and removing tariffs on some Chinese imports, which gave stocks a huge boost on Tuesday.
Stock plummeted on Wednesday with the Dow Jones Industrials tumbling 800 points — the fourth largest daily point drop on record and the worst this year.
Global recession fears drove Wall Street investors to the safety of U.S. government debt as the yield curve inverted. That’s when the yield on the 2-year note exceeds the yield on the 10-year Treasury. it has been an historically accurate indication that a recession is on the way.
Global growth fears were also part of the selling equation as Germany’s growth contracted and several reports from China indicated slowing of the economy.
Traders are also concerned about the protests in Hong Kong, where police and protesters faced off again, after Trump tied a U.S. trade deal with China to a humane resolution of the protests.
|CSCO||CISCO SYSTEMS INC.||46.94||-3.67||-7.26%|
|GE||GENERAL ELECTRIC COMPANY||8.25||-0.78||-8.59%|
In other earnings, J.C. Penney reported a smaller-than-expected second-quarter loss, lifting shares.
Cisco Systems shares fell after the company forecast current-quarter profit below Wall Street estimates.
General Electric shares are taking a hit after Harry Markopolos, the whistleblower in the Bernard Madoff Ponzi scheme case, said GE’s financial filings were masking the depths of its financial problems. He posted a research report accusing GE of hiding $38.1 billion in potential losses and asserted that the company’s cash situation was far worse than it had disclosed. GE said it “stands behind its financials” and operates to the “highest-level of integrity” in its financial reporting in a statement to Reuters.
In other economic news, the number of Americans filing applications for unemployment benefits increased more than expected last week. Initial claims for state unemployment benefits increased 9,000 to a seasonally adjusted 220,000.
The Associated Press contributed to this article.