Jakarta, CNBC Indonesia – The United States (US) stock market opened lower on Tuesday (17/8/2021), following the decline in US retail sales as of July which indicated that the delta variant of the Covid-19 virus was really hitting the economy.
The Dow Jones Industrial Average fell 277.8 points (-0.78%) at 08:30 local time (20:30 WIB) and within 30 minutes to minus 337.9 points (-0.95%) to 35,287.52 . The S&P 500 was down 36.3 points (-0.81%) at 4,443.45. The Nasdaq dropped 166.7 points (-1.13%) to 14,627.04.
Retail sales as of July reportedly fell 1.1% or much worse than economists’ expectations in a Dow Jones survey that forecast a decline of only 0.3%. This figure is much worse than the achievement in June which scored an increase of 0.6%.
Home Depot shares fell more than 3% at the opening in response to the release of the data, especially since the company reported sales growth at the same store of only 4.5 percent in the second quarter of 2021, or below the market consensus of 5 percent.
Walmart shares were also depressed after the company estimated that earnings per share would only be around US$ 1.3-US$ 1.4/share in the third quarter of 2021, or below the market consensus compiled by StreetAccount of US$ 1.32/unit.
The Dow and S&P 500 rallied for a fifth straight day on Monday, gaining 0.31% and 0.26%, respectively. In contrast, the Nasdaq was down 0.2%. The rally came even as China’s retail sales rose only 8.5% (yoy) in July, below economists’ projections in a Reuters poll of 11.5%.
S&P 500 technically prints pattern bullish by doubling from its lowest position during the pandemic, namely on March 23, 2020. This is a pattern bullish fastest since World War II.
“The increase in Covid-19 case growth is likely to trigger a slowdown like that seen in China and depress manufacturing sentiment, but the economic impact – at least in the US and Europe – is unlikely to be large,” Goldman Sachs wrote in a research report cited by Reuters. CNBC International.
CNBC INDONESIA RESEARCH TEAM
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