By Geoffrey Smith
Investing.com -- U.S. stock markets opened lower on Tuesday, giving much but by no means all of the gain they made on Monday in response to the latest booster shot of good news on the Covid-19 vaccine front.
By 9:40 AM ET (1440 GMT), the Dow Jones Industrial Average was down 340 points, or 1.1%, at 29,610 points, having closed on Monday at a new record high for the first time since the pandemic erupted in February.
The S&P 500 was down 0.7%, while Tesla (NASDAQ:TSLA) stock was up 11.3% after S&P Dow Jones Indices said it will include the carmaker in its benchmark index from December 21.
Despite the gains in Tesla, the NASDAQ Composite was down 0.2%.
Sentiment was dented earlier by the release of figures showing that retail sales rose more slowly than expected in October, by a mere 0.3%. September’s figures were also revised downwards, reviving fears that the failure to extend government support for the high numbers of Americans made unemployed by the pandemic may be feeding through into demand.
Another headwind came from Washington, where Senate Leader Mitch McConnell signaled there would be no more accommodation with House Democrats in the near future than there had been before the election, at least where the issue of fiscal support for the economy was concerned. McConnell accused the Democrats of ;holding a virus relief bill hostage.'
There were big losses in drugstore stocks after Amazon (NASDAQ:AMZN) announced its plans to get into online filling of prescriptions, over two years after its $750 million acquisition of PillPack. CVS (NYSE:CVS) stock fell 7.9% and Walgreens Boots Alliance (NASDAQ:WBA) fell 8.7% on fears that the online giant could erode what has previously been an impregnable market position for them. Amazon stock gained 1.2%, meanwhile, on the prospect of another significant revenue stream and rich source of customer data.
Elsewhere, Walmart (NYSE:WMT) stock and Home Depot (NYSE:HD) stock both fell despite both companies reporting quarterly earnings that were better than expected. Walmart’s earnings per share rose 15% on a 5.2% rise in revenue that owed much to a 79% increase in sales through its online channel. Its stock still fell 0.5% on concerns that its sales growth was slowing..
Home Depot, a big winner from a pandemic, fell 2.5% amid fears that the end of the pandemic – which has made its way onto people’s radar screens thanks to signs of at least two effective vaccines being distributed next year – may also end the incentive to invest in home improvement.