Markets weaken as energy stocks, Home Depot weigh

NEW YORK >> Stocks on Wall Street sank Tuesday after Home Depot warned of flagging sales, the latest discouraging signal for an economy under pressure.

The S&P 500 fell 26.38 points, or 0.6%, to 4,109.90. The Dow Jones Industrial Average dropped 336.46, or 1%, to 33,012.14, and the Nasdaq composite slipped 22.16, or 0.2%, to 12,343.05.

Energy producers were some of the heaviest weights on the market as Exxon Mobil dropped 2.4% and Chevron fell 2.3%.

Home Depot also fell 2.2% after saying its revenue weakened by more in the latest quarter than expected. It described broad-based pressures across its business following years of big growth, and it cut its forecast for sales this fiscal year given all the uncertainty going forward.

Other big retailers are scheduled to report their results later this week, including Target and Walmart.

They’re under the microscope because resilient spending by U.S. households has been one of the main positives keeping the economy from sliding into a recession. If it buckles, a recession may be assured, and the pressure is on because measures of confidence among shoppers have been on the decline.

Manufacturing and other areas of the economy have already cracked under the weight of much higher interest rates meant to bring down inflation.

A separate report on Tuesday said that spending at U.S. retailers across the country broadly rose last month, but not by as much as economists expected.

“There’s often a gap between how people say they feel and how they spend their money, but the retail sales report shows people are beginning to cut back on big ticket items and discretionary categories like sporting goods,” said Brian Jacobsen, chief economist at Annex Wealth Management.

Economists pointed to some brighter spots underneath the surface of the report on retail sales, including stronger-thanexpected gains after ignoring auto fuel costs. A separate report released later in the morning also offered some encouraging data: The nation’s industrial production unexpectedly grew in April.