Chapter 1: What is the main topic discussed in this episode?
Hey, listeners. It's Saturday, November 22nd. I'm Telus Demos for The Wall Street Journal, filling in for Francesca Fontana. And this is What's News in Markets, our look at the biggest stock moves of the week and the news that drove them. So let's get to it. This week in markets, investors, they just wanted out.
They wanted out of AI stocks, fearing inflated valuations and overly aggressive spending. But it wasn't just that. They also wanted out of things that are usually meant to go up when stocks are going down. Things like Bitcoin and gold.
Chapter 2: What were the major stock market movements this week?
The week started off with two straight days of sell-offs. Then Nvidia posted a record $57 billion in revenue for the quarter. That set off a frantic morning rally on Thursday from Tokyo to New York. But by the end of the session, the sell-off was back. Even Nvidia, big as it is, couldn't save the market. The indexes blew their gains and went back into the red.
AI wasn't the only thing on investors' minds, though. Another big factor behind the swoon? A belief that the Fed won't ride to the rescue with another rate cut next month. That belief firmed up after the delayed, but better than expected, September jobs report. Good news for job seekers was bad news for risk takers.
One Fed official did make the case for a rate cut on Friday morning, sending stocks higher, where they finished heading into the weekend. Still, all three major indexes ended the week lower, with the Dow off by 1.9%, the S&P 500 down by more than 1.9%, and the Nasdaq down 2.7%. On the home front, it was a tale of two home improvement retailers this week.
On Tuesday, Home Depot trimmed its full year outlook after a hoped-for uptick in demand failed to materialize. The company also raised prices in some categories to help offset tariffs and said the lack of storms weighed on sales for roofing, power generation, and plywood versus last year. Its shares plunged 6% on Tuesday.
A day later, Lowe's sang a different tune, reporting higher third-quarter sales driven by online sales and continuing growth in its professional builder supply business. While economic uncertainty, a stalled housing market, and high interest rates have led homeowners to delay remodeling and repair projects, Lowe's expressed optimism that the downturn might be starting to reverse.
Lowe's shares jumped 4% on Wednesday. And on the week, its stock closed 2.8% higher on while rival Home Depot shares finished down 5.25%. Speaking of renovations, Target is eyeing its own improvements.
After cutting its annual profit outlook, the big box retailer said Wednesday it plans to put a billion dollars more toward upgrading its stores, bringing its total new investment next year to $5 billion. The revamp, aimed at addressing shoppers' gripes, will include store experience improvements, better merchandise selection, and better technology and e-commerce.
Investors were less enthused with the plans, with target shares falling 2.8% on Wednesday. The stock ended the week down 2.5%. Meanwhile, shoppers of all incomes are flocking to rival Walmart for a good deal. The retail giant is offering low prices on everything from eggs to milk to shoes, tires, and delivering those items to doorsteps fast.
That's certainly good news for Walmart, but if people are focused on the basics and willing to hunt for discounts, that might say something pretty concerning about the state of mind of the American consumer. On Thursday, Walmart raised its full-year outlook after reporting strong sales for the quarter. Its shares jumped 6.5% on Thursday and closed out the week almost 2.8% higher. And finally, AI.
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