Shares of Macy’s, Dollar Tree, and Dollar General surged Thursday after all three retailers reported disappointing profits on Wall Street and countered recent concerns about the health of American consumers. As a result, the stock market has risen and is on track to record its first weekly profit after seven consecutive weekly losses.As a result, the S & P500 index will be The brink of bear market..
Shares rose sharply on Thursday, with the S & P 500 up 2%. The high-tech Nasdaq Composite Index, which had been in the bear market for several months, generally defined as a 20% drop from its recent peak, rose 2.9%.
Macy’s shares rose 18% in the afternoon trading. The company announced that its profits for the most recent quarter have more than doubled year-on-year. The company described this as “strong.” Macy’s also raised its annual profit forecast by saying that shoppers have shifted from pandemic active leisurewear.
“We saw a marked shift to opportunity-based apparel and in-store shopping, and the continued strength of luxury goods sales,” Macy’s said. Said in a statement..
Discount chains also exceeded analysts’ expectations Dollar tree Profit in the last quarter has risen by more than 40%, Dollar General It reported a smaller than expected 18 percent decline. Both companies have raised their sales forecasts this year, and Dollar Tree has also raised their earnings forecasts. Dollar Tree’s share rose 21% and Dollar General rose 14%.
The index that tracks consumer discretionary industries, including retailers, rose by more than 5%, making it the highest performing sector of the day.
Higher-than-expected results and outlook can help alleviate concerns about how supply chain problems and rising prices affect consumer spending, which accounts for the majority of US economic activity.Those worries came to the forefront after last week Target and walmart He reported disappointing results and said inflation had hit profits.
Macy’s and the Dollar Store weren’t the only retailers that exceeded expectations. On Wednesday, Nordstrom’s profits and sales were higher than expected, but Dick’s sporting goods said personal consumption remained strong. Nordstrom’s share price rose 5% on Thursday, Dick’s sporting goods rose 8%, and surged on Wednesday. Costco was set up to report revenue after the market closed.
Retailers are still paying attention. “It’s a very difficult time for consumers because many people pay their lives,” Richard W. Drayling, executive chairman of Dollar Tree, called an analyst. .. “They face the highest inflation since the early 1980s, record high gas prices, the effects of pandemics, geopolitical uncertainties and more.”
Beth Ambobino, US Chief Economist at S & P Global, said low-income households are “much dramatically squeezed by high fuel and food prices and have less discretionary spending.” “If you have a customer who is devoted to a high-income household, that retailer may be better than a customer who is tied to a low-income household.”
Some industry watchers have warned that revenue reports are likely to continue to be mixed from one period to the next.
Mark A. Cohen, Director of Retail Research at Columbia Business School, said: Overall, he said the situation remained unpredictable. “Wear your helmet with your seat belts fastened and be prepared for bumpy vehicles.”
Coral Murphy Marcos Report that contributed.