Walmart cut its profit outlook again in a surprise warning weeks ahead of its earnings report, sending retailer shares tumbling and raising new questions about consumers’ ability to sustain their voracious spending habits
Walmart Inc. cut its profit outlook again in a surprise warning weeks ahead of its earnings report, sending retailer shares tumbling and raising new questions about US consumers’ ability to sustain their voracious spending habits with inflation at a four-decade high.
“When things go wrong at Walmart, you can extrapolate that it’s happening at other retailers, as well,” said GlobalData’s Neil Saunders. “This will potentially send shock waves through the sector.” The Federal Reserve is widely expected to increase its key policy rate by three quarters of a percentage point later this week, looking to tamp down stubborn inflation even as signs accumulate that the economy could be tilting into a recession.
Consumers, meanwhile, are not only contending with inflation but also shifting more spending to services such as travel and restaurants.
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