Dow Jones Pops as Wal-Mart Announces $20 Billion Buyback

U.S. stocks rose on Tuesday, with the Dow Jones Industrial Average setting a new record after Wal-Mart announced a major buyback plan.

Dow Hits New Milestone

The 30-member Dow Jones blue-chip index climbed 69.81 points, or 0.3%, to 22,830.68. That was the index’s first record close since Thursday. In total, 20 of 30 index members finished in positive territory.

Retail juggernaut Wal-Mart Stores Inc. (WMT) surged 4.5% after announcing a $20 billion buyback plan. The buyback was announced after the company gave firm guidance on sales and revenue for the fiscal year ending January 2019.

Wal-Mart’s U.S. online sales are forecast to surge 40% in the fiscal year as part of a broader focus on e-commerce. The company has started offering free two-day shipping and is planning to reduce the number of physical stores.

Surging Wal-Mart shares drove the consumer staples sector firmly higher. The S&P 500’s consumer staples index rose 1%, far outpacing the large-cap average.

The S&P 500 Index closed 0.2% higher at 2,550.63. Meanwhile, the technology-heavy Nasdaq Composite Index added 0.1% to finish at 6,587.25.

Markets Shrug Off Catalonia Risks

Wall Street was surprisingly buoyant Tuesday in the face of geopolitical risks in the autonomous region of Catalonia. On Tuesday, Catalonian leader Carles Puigdemont said his people wanted independence from Spain, but that self-determination would be achieved only though a negotiated solution.

European stock markets have held relatively steady through the first two sessions of the week. The pan-European Stoxx 600 finished flat on Tuesday after rising 0.2% during the previous session.

Haven assets put up solid advances on Tuesday, with some investors hedging against Catalonian independence. December gold futures, the most actively traded futures contract, came within $3 of $1,300.00 on Tuesday.

The Japanese yen also firmed up against the dollar, with the USD/JPY exchange rate briefly falling below 112.00.

There were no major economic or monetary news events on Tuesday. The Federal Reserve will release the official transcript of the September FOMC meeting on Wednesday. Fed officials kept interest rates on hold in September, but agreed to begin reducing their holdings of bonds at a rate of $10 billion a month.

Fresh economic data will make the rounds in the latter half of the week, including producer inflation, consumer prices and retail sales. These data sets will help investors determine the health of the U.S. economy at the end of the third quarter.

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Chief Editor to and Contributor to, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi