• S&P 500: Increased by 0.4% to 5,916.93, marking its fourth consecutive day of gains.

• Dow Jones Industrial Average: Rose by 0.65%, or approximately 272 points, closing at 42,322.75.

• Nasdaq Composite: Declined by 0.18% to 19,112.32, snapping a six-day winning streak.

Walmart’s Earnings and Price Hike Alert

• Walmart reported better-than-expected fiscal Q1 2025 results, with adjusted earnings per share at $0.61 and total revenue up 2.5% to $165.6 billion. Despite maintaining its full-year guidance, CEO Doug McMillon warned that U.S. tariffs on imported goods will lead to higher retail prices due to cost pressures starting in late April. CFO John David Rainey indicated that customers can expect to see price increases by the end of May and extending into June.

Retail Sales and Inflation Indicators

• Retail Sales: Slowed sharply in April, barely rising, indicating a potential cooling in consumer spending.

• Producer Price Index (PPI): Unexpectedly fell by 0.5% in April, suggesting easing wholesale inflation.

• Consumer Price Index (CPI): Showed inflation pressures easing to four-year lows.

Federal Reserve’s Outlook

• Federal Reserve Chair Jerome Powell emphasized the increasing economic “uncertainty,” noting that the U.S. economy may be entering a period with more frequent “supply shocks” and volatile inflation. He indicated that the Fed would place more weight on the inflation outlook than on employment when setting monetary policy.

Sector and Stock Highlights

• Defensive Sectors: Utilities and Consumer Staples led the S&P 500, both rising over 2%.

• Dollar General: Shares increased by more than 6%.

• Deere & Company: Stock rose almost 4%, despite projecting approximately $500 million in tariff expenses for the year.

• Meta Platforms: Shares fell more than 2% due to delays in the rollout of a flagship AI model.

• Amazon: Stock declined by 2.4% following job cuts in its devices and services division

What’s Next?

 The current market environment underscores the delicate balance investors must maintain amid geopolitical tensions and domestic economic indicators. While strong corporate earnings provide some optimism, the overarching uncertainty surrounding trade policies and their ripple effects on consumer behavior and inflation cannot be ignored.