By Yashaswini Swamynathan
U.S. stocks fell on Friday as Wal-Mart and other retailers were slammed by Amazon.com's biggest foray into the brick-and-mortar retail sector with its $13.7 billion deal to buy upscale grocer Whole Foods.Amazon shares were up 3.2 percent at $995.18, while Whole Foods surged 27 percent to $41.95.The deal by Amazon, a proven retail disruptor, is seen as a threat to supermarket chains and grocers, given the company's readiness to sacrifice margins for market share.Wal-Mart sank 6.2 percent to $74.03 even as the big box retailer strengthened its ecommerce presence by buying online men's fashion retailer Bonobos for $310 million on Friday. The stock weighed the most on the S&P 500 and the Dow.
"Dominant players like Wal-Mart, Kroger, Costco, and Target now have to look over their shoulders at the Amazon train coming down the tracks," said Charlie O'Shea, lead retail analyst at Moody's Investors Service.Kroger was the biggest loser on the S&P 500, down 14 percent; while Sprouts Farmers Market was off nearly 10 percent. "I would not like to be somebody playing in the grocery space right now," said Jan Rogers Kniffen, chief executive of retail consultancy firm J. Rogers Kniffen WWE in New York.
The S&P 500 consumer staples tumbled 1.7 percent - its biggest drop since November last year. At 11:03 a.m. ET (1503 GMT), the Dow Jones Industrial Average was down 35.58 points, or 0.17 percent, at 21,324.32, the S&P 500 was down 7.48 points, or 0.31 percent, at 2,424.98 and the Nasdaq Composite was down 32.00 points, or 0.52 percent, at 6,133.50.
Six of the 11 major S&P sectors were lower. Technology was the second-biggest loser after consumer staples, led by losses in Microsoft and Apple. The sector, which had surged 17.4 percent in 2017, is on track for its second straight week of decline as investors booked profits amid worries of stretched valuations.Declining issues outnumbered advancers on the NYSE by 1,547 to 1,171. On the Nasdaq, 1,769 issues fell and 872 advanced. (Reporting by Yashaswini Swamynathan in Bengaluru; additional reporting by Sruthi Shankar; Editing by Anil D'Silva)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Published Date: Jun 16, 2017 11:00 pm | Updated Date: Jun 16, 2017 11:00 pm