Consumer companies slid as traders fled rate-sensitive sectors in light of hotter-than-anticipated inflation data.
The unexpected up-tick in inflation could drive Treasury yields and mortgage rates up further, shortly after the average 30-year mortgage rate hit a one-month high above the daunting 7% level.
"We still expect inflation to trend lower over time as the high level of interest rates weighs on economic growth," said Brian Rose, senior economist at money manager UBS Global Wealth Management.
"Consumer spending has been surprisingly strong so far this year, but more households have used up the excess savings built during the pandemic. Credit card rates are at a record high and more people are carrying debt, which implies that spending will have to slow at some point," Rose said.
Department-store chain Macy's averted a fight for control of its board but added new directors who will help decide whether to accept a takeover bid it had previously resisted. Delta Air Lines reported first-quarter revenue that rose to record levels, fueled by reaccelerating business-travel demand.
Membership-based retail Costco Wholesale is generating strong interest from its sale of gold and silver, and it could have a palpable effect on its same-store sales, if not on net income, said analysts at brokerage Wells Fargo.
Write to Rob Curran at rob.curran@dowjones.com
(END) Dow Jones Newswires
04-10-24 1718ET
