Billions of Walmart evaluation were eliminated on Tuesday, as the data revealed a bleak economic view between American consumers.
The price of the walmart shares decreased by 3.1 percent by closing the market, which led to a decrease in the market value by 21.89 billion dollars on Tuesday, for each company Markemarkcap.com.
Why do it matter
With consumers who already show signs Decline in spending habitslike Wal MartThe CEO of S recently warned that the retail sector can be difficult if confidence fails to recover and the country continues on its way Towards an economic shrinkage. Given that spending on consumers explains more than two -thirds of the country’s gross domestic product, continuous low confidence can increase the chances of stagnation in the near future.
What do you know
The $ 22 billion loss of Walmart was the largest decrease in the evaluation on Tuesday, followed by the NVIDIA chips, which saw a 0.6 percent decrease in its share price, which led to a decrease of $ 17 billion in the total market ceiling.
The retail giant declining coincided with the monthly report of the Conference Council on US consumer confidence, which revealed another decrease.
The consumer confidence index fell to 92.9 points in March, as it fell for a fourth consecutive month and reached its lowest level since early 2021.
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Expectations Index-which is a measure of consumer expectations in the short term of income, business, and labor market conditions-to 65.2, which is its lowest point in 12 years and less than 80 points said by the research tank “usually” It indicates a recession forward“
Consumer expectations of stagnation remained over the next 12 months without change from February, while their evaluation of their current financial situation witnessed a slight improvement. However, the perception of the financial situation of their family decreased six months ago to its lowest level in more than two years.
What people say
CEO of Wall Mart Doug McMelon In late February, he indicated that the “compressed budget” customers were underestimating their spending and displaying “stressful behaviors.”
“You can see that the money is running out before the month’s end, you can see that people buy smaller packages at the end of the month,” McMelon said.
Bill Adams, chief economist of Komerica BankIn joint comments with Newsweek After the consumer confidence report, he said: “Klaxon was the headlines, the falling stock market, and the concerns of customs tariffs were a major blow to the consumer confidence in early March.
“The withdrawal in confidence has become a real threat to spending on consumers, which is often repeated from two -thirds of the American economic activity.”
“The negative risks to economic expectations have increased significantly during the past month,” he added. “People who fear that the economy is heading to a trench that will not buy new cars or homes, or go out to eat, or on vacations. If consumers’ morale continues to acidity, it is likely that spending will follow it to a decrease and the economy may take great success.”
Stephen Miran, Chairman of the Economic AdvisersHe told CNBC on Tuesday: “I don’t think there was a very strong connection between [consumer] Actual confidence and spending data for consumers in recent years. And if you go out on the street, people are walking in their lives, as you know, they get their salaries, then they spend their salaries. The economy is moving forward. “
“There is a full set of data for the very decent economy, very good,” he added.
What happens after that
According to Yahoo Finance, the price of the Walmart share increased by about 0.3 percent in pre -market trading on Wednesday, indicating that the company may recover some lost value on Tuesday.
