U.S. stocks charged ahead to close a choppy session higher on Tuesday after investors shrugged off Target’s profit warning that weighed on broader markets in earlier trading.
The S&P 500 rose about 1% and the Dow Jones Industrial Average gained 264 points, or 0.8%. The tech-heavy Nasdaq advanced about 0.9%. The indexes rose after struggling for direction for much of the day. Meanwhile, the benchmark 10-year US Treasury retreated below 3%.
Goal (TGT) took center stage during morning trade after the retailer cut its guidance and said yes with the aim of reducing excess inventory offering discounts, canceling orders and reassessing its spending, an announcement that comes just weeks after the company surprised investors with a dramatic loss in earnings that sent shares down 25%.
Target shares closed up 2.3%. The warning also weighed on other retail peers as a growing number of companies sound the alarm about the toll inflation and supply chain imbalances are taking on their margins. Walmart stock (WMT) fell 1.2% and Costco (COST) closed just below the plane.
Elsewhere in the markets, oil topped $120 a barrel, giving a boost to the energy sector. Exxon shares (XOM) rose 4.6%, marking the oil conglomerate’s biggest intraday gain after analysts at Goldman Sachs and Credit Suisse raised their price targets on the company. The stock topped $100 for the first time since 2014.
Kohl’s (KSS) was also in the spotlight after the owner of Vitamin Shoppe Franchise Group is in talks to buy the retailer for $8 billion. Kohls shares rose nearly 10%.
Tuesday’s choppy trading builds on a streak of back-and-forth sessions as investors assess the economic outlook and prepare for central bank policymakers to raise interest rates in an effort to cool inflation.
“Seeing the market, actually quite calm, as it moves between advancing and retreating suggests that until there is a more definitive reading on the inflation front along with the Fed’s thinking about further rate hikes in September, we can expect this to pick up and move forward,” LPL chief financial securities strategist Quincy Krosby said in a note.
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All three major indexes closed in the green on Monday, though well off session highs after faltering from a morning rally. The S&P 500 closed up 0.3% after pulling back from a more than 1% jump, the Dow erased a 300-point gain to end just above breakeven and the Nasdaq rose 0.4%.
“For now, the market sees a Federal Reserve trying to navigate a painful and bumpy road, but trying to find a smooth exit,” Krosby said. “And the market is torn between wanting to believe in the rallies but not believing that the Fed can negotiate a soft landing.”
Inflation is the main concern for investors this week, with the May consumer price index (CPI) from the Bureau of Labor Statistics due out on Friday. Wall Street will be looking for signs that prices have peaked as it expects a pause in monetary tightening in the fall months.
Outside of Friday’s CPI, investors face a lighter economic and earnings calendar this week.
4:00 PM ET: Stocks are down for the second day in a row after choppy trading
Here’s where the S&P 500, Dow and Nasdaq finished trading after the market closed:
S&P 500 (^GSPC): +39.11 (+0.95%) to 4,160.54
Dow (^DJI): +264.03 (+0.80%) to 33,179.81
Nasdaq (^IXIC): +113.86 (+0.94%) up to 12,175.23
Crude (CL=F): +$1.49 (+1.26%) to $119.99 a barrel
Gold (GC=F): +$12.30 (+0.67%) to $1,856.00 per ounce
10-year treasury (^TNX): -6.6 bp to get 2.9720%
10:38 am ET: S&P, Dow and Nasdaq U-turn from morning losses
Here were the top market moves as of 10:38 a.m. ET:
S&P 500 (^GSPC): +10.00 (+0.24%) to 4,131.43
Dow (^DJI): +27.67 (+0.08%) up to 32,943.45
Nasdaq (^IXIC): +51.19 (+0.42%) to 12,112.56
Crude (CL=F): +$1.23 (+1.04%) to $119.73 a barrel
Gold (GC=F): +$7.30 (+0.40%) to $1,851.00 per ounce
10-year treasury (^TNX): -5.3 bp for a return of 2.9850%
9:30 a.m. ET: Stocks sink as target cut outlook weighs on markets
Here’s where the major indexes opened at the start of Tuesday’s session:
S&P 500 (^GSPC): -34.69 (-0.84%) to 4,086.74
Dow (^DJI): -230.58 (-0.70%) to 32,685.20
Nasdaq (^IXIC): -140.86 (-1.17%) to 11,920.51
Crude (CL=F): Settlement date S$ to $N/A per barrel
Gold (GC=F): +$1.20 (+0.07%) to $1,844.90 per ounce
10-year treasury (^TNX): -3.5 bp to get 3.0030%
7:30 am ET: Stock futures fall as Target issues profit warning
Here were the top moves in futures trading ahead of Tuesday’s open:
S&P 500 futures (IS=F): -36.75 (-0.89%) to 4,083.75
Dow futures (YM=F): -259.00 (-0.79%) to 32,653.00
Nasdaq Futures (NQ=F): -142.50 (-1.13%) to 12,462.50
Crude (CL=F): -$0.61 (-0.51%) to $117.89
Gold (GC=F): +$9.70 (+0.53%) to $1,853.40 per ounce
10-year treasury (^TNX): +8.1 bp for a return of 3.0380%
A specialist trader works inside a booth on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., June 3, 2022. REUTERS/Brendan McDermid
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc