t_primary-image-mobile@1/v1629231352/Investing/stock-market-today-081721.jpg” srcset=”https://mediacloud.kiplinger.com/image/private/s–BqNYm5-7–/f_auto,t_primary-image-mobile@1/v1629231352/Investing/stock-market-today-081721.jpg 375w,https://mediacloud.kiplinger.com/image/private/s–BqNYm5-7–/f_auto,t_primary-image-desktop@1/v1629231352/Investing/stock-market-today-081721.jpg 833w,https://mediacloud.kiplinger.com/image/private/s–BqNYm5-7–/f_auto,t_primary-image-mobile@2/v1629231352/Investing/stock-market-today-081721.jpg 750w,https://mediacloud.kiplinger.com/image/private/s–BqNYm5-7–/f_auto,t_primary-image-desktop@2/v1629231352/Investing/stock-market-today-081721.jpg 1666w” sizes=”(max-width: 768px) 375px,(min-width: 768px) 833px,(max-width: 768px) and (min-resolution: 2dppx) 750px,(min-width: 768px) and (min-resolution: 2dppx) 1666px,375px” width=”375″ height=”211″ alt=”An abandoned shopping cart in a parking lot”/>
Tuesday's discouraging U.S. retail sales report did what yesterday's global headlines couldn't: knock down stocks early and keep them down through the close.
Investors learned before the opening bell that July retail sales declined 1.1% month-over-month, a far worse reading than the 0.3% dip economists expected. Core retail sales, which exclude gasoline, autos and a few other categories, also missed expectations, retreating 1.0% vs. June.
15 Best Vanguard Mutual Funds for Investors of All Stripes
“Retail sales have experienced large swings this year, led by the timing of various pandemic-relief stimulus measures,” says Barclays economist Pooja Sriram. “Sales have typically surged in the months that households received rebate checks, followed by sharp declines in the subsequent months. Therefore, a part of the decline in July sales likely reflects fading stimulus effects, with the bulk of the stimulus payout under the America! n Rescue Plan having been distributed in the first half of this year.”
The poor data made for a rough day across the board.
The Nasdaq Composite dipped 0.9% to 14,656, and the S&P 500 lost 0.7% to 4,448. The Dow Jones Industrial Average closed off 0.8% to 35,343, also hurt by a 4.3% decline in Home Depot (HD), which beat quarterly earnings estimates but delivered disappointing same-store sales.
What today's damage signals, however, is up for debate.
Sign up for Kiplinger's FREE Investing Weekly e-letter for stock, ETF and mutual fund recommendations, and other investing advice.
“Tuesday's stock market decline is a trader's tantrum and nothing more,” says George Ball, chairman of investment firm Sanders Morris Harris. “The move is a one-day overdone reaction to some disappointing retail sales data and continued geopolitical tensions in Afghanistan.”
3 Infrastructure ETFs to Harness the Spending Boom
Chris Zaccarelli, chief investment officer for registered investment advisor Independent Advisor Alliance, hints that it could be something more, saying “the summer swoon that everyone has talked about appears to be beginning, but we still believe the strong fundamentals in the economy will allow stocks to end the year higher from here.”
Other news in the stock market today:
A Healthy Showing From Healthcare
One sector did appear fit Tuesday, even as the rest of the market floundered.
11 Mighty Mid-Cap Stocks for the Rest of 2021
Healthcare (+1.2%) was a rare spot of green in a sea of red, led by biotechs Vertex Pharmaceuticals (VRTX, +3.9%) and Regeneron Pharmaceuticals (REGN, +3.0%). Big Pharma firm Pfizer (PFE, +3.1%) also chipped in with gains.
Healthcare continues to give its investors a little bit of everything.
As with food or basic utilities, people are hard-pressed to cut back on life-saving medicines and related care, giving the sector defensive characteristics. That helps support consistent and sometimes high dividends among a number of healthcare stocks.
Meanwhile, the biotech industry can deliver bursts of seriously outsized growth through the discovery of blockbuster drugs. And more recently, some healthcare stocks have allowed investors to profit from the battle against COVID through the development of vaccines and treatments.
Indeed, the sector's ability to benefit from both short-term events and secular trends guided our look at the best healthcare stocks for the rest of 2021. That is, although we were certainly keen on these stocks' potential for tactical outperformance, most of them also stood out because of their long-term promise. Check them out.
Warren Buffett Stocks Ranked: The Berkshire Hathaway Portfolio