Walmart Earnings Disappoint, Raise Possible Red Flag Over US Consumer

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Thursday, Feb. 20. Today’s briefing was delayed a bit to account for Walmart (WMT 0.00%↑) earnings.

State of Play

Stocks treaded water again yesterday but the S&P 500 closed marginally higher, which was enough to book fresh record highs. As we eye our board of indicators for signs of direction at 0705, things aren’t looking great after disappointing earnings from Walmart (WMT 0.00%↑):

• Stock index futures are pointing to a lower open, with S&P and Nasdaq down 0.3% each;

• Commodities: Gold and silver are rallying, up 1% each. That’s $2,965/oz for gold, a fresh all-time high, and getting closer to the elusive $3,000 barrier. Copper is up 1%. WTI crude oil unchanged at $72.30/barrel;

• Cryptos are flat. Bitcoin is unchanged around $97,200;

• Bonds aren’t doing anything either. The 10-year yields 4.54%.

Today’s Known Events

We start once again with earnings:

• Walmart (WMT 0.00%↑) just reported disappointing results and the stock is dropping in the pre-market, down 8% at the time of this writing. The issue appears to be with the outlook and expectations that US consumers will pull back spending. Not a good sign;

• Alibaba (BABA 0.00%↑) earlier beat estimates and that stock is rocketing higher in the pre-market, by almost 7% at the time of this writing;

• Wayfair (W 0.00%↑), Unity (U 0.00%↑), and Shake Shack (SHAK 0.00%↑) are also out before the open at 0930.

• Portfolio holdings (small ones):

  • Jumia Technologies (JMIA 0.00%↑) reported disappointing results and that stock is tanking in the pre-market, down 21% at the time of this writing.

  • Talkspace (TALK 0.00%↑) also reports before the open at 0930.

• After the close at 1600, highlights include Celsius (CELH 0.00%↑), Block (XYZ 0.00%↑), Rivian Automotive (RIVN 0.00%↑), and Mercado Libre (MELI 0.00%↑)

(Walmart earnings a potential dark cloud for markets, by author via Grok AI)