Stock futures TK after Walmart, Home Depot help build on recent rally

Traders work during the opening bell at the New York Stock Exchange (NYSE) on Wall Street in New York City on August 16, 2022.

Angela Weiss | AFP | Getty Images

Stock futures were little changed Tuesday night after two of the nation’s big box chains, Walmart and Home Depot, pushed the Dow and S&P 500 higher, setting the stage for more retail earnings this week.

Futures tied to the Dow Jones Industrial Average fell 1[ads1]7 points, or 0.5%. S&P 500 futures and Nasdaq 100 futures fell 0.04% and 0.07%, respectively.

In regular trading, the Dow ended up 239 points, or 0.7%, and the S&P gained 0.2%. The Nasdaq Composite fell 0.2 percent.

Retailers led the market higher, thanks in large part to strong quarterly results from both Walmart and Home Depot, which were the biggest gainers in the 30-stock Dow, pulling others like Target, Best Buy and Bath & Body Works up with them.

The Dow reached its fifth consecutive day of gains. Meanwhile, the S&P 500 is going for its fifth straight week as investors continue to gauge how much strength this rally has. The broad market index is now up 18% from the lowest level in June.

“This market has been so resilient,” Brynn Talkington, managing partner at Requisite Capital Management, said on CNBC’s “Closing Bell: Overtime.” “As we approach the end of earnings, earnings are going to hit a median of around 7%.”

Giving her “a big break” in this market is the Federal Reserve and its plans to continue raising interest rates and shrinking the size of its balance sheet. “Earnings have remained strong, but … the Fed balance sheet has not budged,” she said.

Gabriela Santos, global market strategist at JP Morgan Asset Management, said investors need to be on the lookout for more volatility on the way.

“Real interest rates are set to rise further in the fall, which could pressure growth stocks again,” she said. “[With] the macro story that has recently taken hold and led to some more broad-based gains in the market – it is far too early to have any kind of confidence that we really know the shape of inflation going into the fall or next year, or that we know how the Fed will respond to that inflation.”

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