June 7 (UPI) — U.S. markets closed with gains on Tuesday, shaking off struggling retail stocks amid a warning from Target about its profits this quarter.
The Dow Jones Industrial Average gained 264.36 points, or 0.8%, while the S&P 500 rose 0.95% and the Nasdaq Composite climbed 0.94%.
Shares of Target fell 2.44% after the company cut its quarterly guidance and announced it would work to cut down its excess inventory by offering discounts, canceling orders and reevaluating its expenses.
Other retailers also struggled following the news with Walmart dropping 1.27% while Home Depot slid 0.67%.
“I hear shifting spending, not stopping spending. So if you think about the past few years, you have had a move toward goods spending over services spending. That is now unwinding as we push further from the impact that COVID had on us,” Brent Schutte of Northwestern Mutual Wealth Management told CNBC.
Conversely, shares of Kohl’s jumped up 8.21% amid reports that Vitamin Shoppe owner Franchise Group was engaged in discussions to purchase the company for $8 billion.
The energy sector helped lift the S&P on Tuesday as oil futures rose near $120 per barrel. Shares of Exxon climbed 4.57%, while Phillips 66 gained 3.71% and Chevron grew 1.91%.
Shares of J.M. Smucker rose 5.71% after better-than-expected quarterly earnings, while Apple stock rose 1.76% to help lift the tech sector.
Markets ended Tuesday well off their mid-May lows after several volatile days of trading as investors brace for the Federal Reserve to hike interest rates.
“Watching the market, actually fairly calm, as it teeters between inching ahead and pulling back, suggests that until there’s a more definitive reading on the inflation front coupled with the Fed’s thinking on further rate hikes in September, we can expect this bounce back and forth,” LPL Financial Chief Equity Strategist Quincy Krosby said in a note.