Consumer companies fell as traders hedged their bets on the outlook for interest rates.

Robust second-quarter gross-domestic product data reignited fears about inflation and interest-rate policy.

Consumer companies had initially rallied after Kering, the French luxury conglomerate that owns Gucci, agreed to buy a stake in Italian rival Valentino, adding to its portfolio of fashion labels, which also includes Saint Laurent and Balenciaga. The vote of confidence in the luxury fashion business bolstered shares of Kering's rival, LVMH Moet Hennessy Louis Vuitton, and others.

Airlines lost ground after Southwest Airlines warned its revenue per available seat mile was declining, a sign that the discount airline was having trouble filling planes. A push into short-hop routes designed to lure business travelers was mistimed, and Southwest will now pivot to more long-haul routes favored by tourists, Southwest executives said.

Cruise lines rose after Royal Caribbean posted robust ticket sales growth, suggesting the post pandemic rebound in cruise activities is ongoing.

A meal celebrating retro purple mascot Grimace last month helped drive McDonald's U.S. same-store sales up 10% in its second quarter.


Write to Rob Curran at rob.curran@dowjones.com

(END) Dow Jones Newswires

07-27-23 1740ET