US stocks were part of a global sell-off on Tuesday as a week full of retail began to show continued consumer resilience in the United States, but China painted a bleak picture for the world’s second-largest economy.
The Dow Jones Industrial Average (^DJI) fell 1% as banking stocks fell amid the prospect of stricter supervision. The S&P 500 (^GSPC) was down about 1.2%, while the heavy Nasdaq Composite (^IXIC) was down 1.1%. The moves added to the pressure on stocks in a dismal August after indices had a rebounding day on Monday, with the Nasdaq up more than 1%.
Home Depot (HD) kicked off the retail earnings week by beating estimates but warning of “continued pressure” on consumers, as the company said customers were pushing back on home renovation projects. Target (TGT) is up next Wednesday, while Walmart (WMT) reports Thursday.
Meanwhile, retail sales figures released Tuesday morning indicated continued health for the American consumer. Retail sales rose 0.7% in July from the previous month, more than Wall Street’s estimate for growth of 0.4%.
China’s continuing economic woes have taken center stage globally, with the country reporting a further deterioration in the health of its economy. China’s central bank unexpectedly cut a range of key interest rates in an effort to stimulate growth in its ailing economy. Notably, it also stopped publishing youth unemployment data after months of volatility.