{"id":85533,"date":"2023-11-17T00:44:56","date_gmt":"2023-11-17T05:44:56","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/walmarts-shareholders-may-have-anticipated-todays-selloff-if-theyd-been-watching-its-bonds\/"},"modified":"2023-11-17T00:44:58","modified_gmt":"2023-11-17T05:44:58","slug":"walmarts-shareholders-may-have-anticipated-todays-selloff-if-theyd-been-watching-its-bonds","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=85533","title":{"rendered":"Walmart\u2019s shareholders may have anticipated today\u2019s selloff \u2014 if they\u2019d been watching its bonds"},"content":{"rendered":"
\n

Shareholders of Walmart Inc. may have had an inkling of today\u2019s stock selloff if they had been watching the performance of its bonds over the last two weeks.<\/p>\n

The bonds have seen net selling even as spreads have tightened, according to data solutions company BondCliQ Media Services.<\/p>\n

\n

The same is true for Costco Wholesale Corp.
\n COST,
\n -3.05%<\/bg-quote>,<\/span>
\n as the company\u2019s stock fell in sympathy with Walmart on Thursday. That was after Walmart
\n WMT,
\n -8.09%<\/bg-quote>
\n Chief Executive Doug McMillon said he expects to see a U.S. deflation trend in the coming months.<\/p>\n

McMillon was the first retail executive to raise the specter of deflation on an earnings call this season so far. <\/p>\n

For more, read:<\/strong> Walmart\u2019s stock on pace for largest daily percentage decline in over a year after earnings<\/p>\n

The comment came after the retail giant posted better-than-expected third-quarter earnings, but offered per-share earnings guidance that was below consensus, sending the stock down more than 7%.<\/p>\n

The following charts show what\u2019s been happening with Walmart and Costco bonds in the run-up to today\u2019s numbers. <\/p>\n

Bondholders tend to be keenly focused on a company\u2019s underlying financials and closely watched metrics such as cash flow to ensure it can cover interest payments.<\/p>\n

That\u2019s because, by buying corporate bonds, they are effectively lending money to a company for a set term and want to be sure they will get their full investment back once they mature. Shareholders tend to be more tuned into daily stock-price movements. <\/p>\n

<\/p>\n

<\/p>\n

<\/p>\n
<\/div>\n<\/figure><\/div>\n

The following chart shows the two-week volume for the bonds by trade type.<\/p>\n

<\/p>\n

<\/p>\n

<\/p>\n
\n \"\"\n <\/div>\n<\/figure><\/div>\n

The next chart focuses on two-week client flows, showing net selling for both issuers over the period. <\/p>\n

<\/p>\n

<\/p>\n

<\/p>\n
\n \"\"\n <\/div>\n<\/figure><\/div>\n

The selling has come as spreads have been tightening, as the next chart illustrates.<\/p>\n

<\/p>\n

<\/p>\n

<\/p>\n
\n \"\"\n <\/div>\n<\/figure><\/div>\n

Walmart\u2019s numbers come after other retailers this week said they are seeing signs of pushback from their customers, especially when it comes to big-ticket items.<\/p>\n

That was the message from Target Corp.
\n TGT,
\n -0.40%<\/bg-quote>
\n on Wednesday, with that company\u2019s sales number lagging consensus. Chief Executive Brian Cornell the company saw soft industry trends in discretionary categories, as well as higher inventory shrink.<\/p>\n

See also:<\/strong>\u00a0Target CEO says consumers are still spending, but sees pressure on discretionary items<\/p>\n

On Tuesday, Home Depot Inc.
\n HD,
\n -0.57%<\/bg-quote>
\n said its customers were avoiding big-ticket items. <\/p>\n

\u201cThe third quarter was in line with our expectations \u2013 similar to the second quarter, we saw continued customer engagement with smaller projects and experienced pressure in certain big-ticket, discretionary categories,\u201d said Home Depot\u00a0CEO Ted Decker, during a conference call to discuss the results.<\/p>\n

For more, see: <\/strong>Home Depot CEO says 2023 \u2018a period of moderation\u2019 in home improvement spending<\/p>\n

Related: <\/strong>Home Depot says \u2018the\u00a0worst of the\u00a0inflationary environment is behind us,\u2019 but prices have settled unevenly<\/p>\n

Costco\u2019s stock was down 2.5%, while Home Depot was down 0.7% and Target was down 0.2%. <\/p>\n

The SPDR S&P Retail exchange-traded fund
\n XRT
\n was down 3% and has gained 2% in the year to date, while the S&P 500
\n SPX
\n has gained 17%. <\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Shareholders of Walmart Inc. may have had an inkling of today\u2019s stock selloff if they had been watching the performance of its bonds over the last two weeks. The bonds have seen net selling even as spreads have tightened, according to data solutions company BondCliQ Media Services. The same is true for Costco Wholesale Corp. […]<\/p>\n","protected":false},"author":1,"featured_media":85534,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-85533","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nWalmart\u2019s shareholders may have anticipated today\u2019s selloff \u2014 if they\u2019d been watching its bonds | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Shareholders of Walmart Inc. may have had an inkling of today\u2019s stock selloff if they had been watching the performance of its bonds over the last two\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=85533\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta 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