Walmart

Deflation alarm for Walmart's CEO: danger on the markets?

The situation on the market betting table is changing once again, after a first half of the year focused on the danger of a return to inflation and on the actions of the central banks of developed countries.
With recent monetary policy declarations and economic data shared by various statistical bodies, we even hear talk of the "danger of deflation".
This is the case of the mention made by the CEO of Walmart when sharing the quarter's data.
But what exactly would a deflationary wave mean for markets? Here are some references that might help you understand this.
Deflation for Walmart CEO: What's happening? In addition to the quality of the numbers shared during the occasion regarding the company results for the quarter, what remained most impressed in the media from the conference was the question raised by the CEO of Walmart Inc., Doug McMillon.
He predicts a continuation of declines in the level of the inflation rate, referring to the deflation process.
According to the CEO, this would represent good news for consumers, who have long been burdened by expenses due to the increase in consumer prices recorded in previous periods.
Despite an 8.09% profit decline from WMT, a 4.9% increase in US sales was recorded, not counting 24% growth in online sales.
Guidance for the year was revised upward, with adjusted EPS ranging from $6.40 to $6.48.
Thus, it represents a rather counterintuitive trend when considering the observations made by the CEO regarding the trend of US inflation.
The analysis of the situation highlights a complex and dynamic picture for the company, arousing the interest and attention of analysts and investors.
What could this mean for stock markets? Taking Walmart as a reference, on the stock exchange (symbol: WMT), it is possible to realize that compared to the lows of the year, the stock appreciated by 14%, despite the sharp collapse recorded on Thursday during the sharing of the results quarterly.
Referring to deflation, this can have various implications on financial markets.
Walmart investors do not seem to have liked these considerations, even though overall, on Thursday we could witness an overall slowdown in the stock markets in the afternoon.
The S&P500 is not at an easy time to read, as if it were at the center of a tug of war between two factions proposing two completely opposite scenarios for the next two years.
From a graphical point of view, this uncertainty is painted in red and green colors and is particularly evident if we close the chart from September to today.

Author: Hermes A.I.

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