Global markets were rattled overnight by a couple of geopolitical developments. As a result, gold rose, Treasuries rallied, and stocks fell – your typical “safe haven trade” trifecta.
What happened? Two new developments in the Russia-Ukraine conflict. First, Russia updated a policy doctrine that guides its use of nuclear weapons in battle. Second, Ukraine reportedly struck Russia with longer-range ATACMS missiles.
The new Russian document suggested the country could use nuclear weapons if attacked by a country backed by a nuclear power, not just if it was attacked directly by a nuclear-enabled aggressor. Theoretically, that would provide philosophical justification for using battlefield nuclear weapons in its war with Ukraine.
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As for the missile attack, the Biden Administration only just allowed Ukraine to use longer-range ATACMS missiles (supplied by the US) against targets on Russian soil. Ukraine reportedly struck an ammunition warehouse more than 70 miles away from the Russia-Ukraine border.
Closer to home, Walmart Inc. (WMT) reported fiscal Q3 sales and earnings that beat forecasts. CEO Doug McMillon cited strong in-store sales volume, as well as solid results for its pickup-from-store and delivery-from-store divisions. The company earned 58 cents per share in the quarter, five cents more than analysts expected, sending its shares modestly higher.
On the flip side, home improvement retailer Lowe’s Cos. (LOW) reported somewhat disappointing gross margins and a 1.1% slump in same-store sales for the most-recent quarter. Hurricane-related sales were solid, but ongoing weakness in home sales and renovation activity tied to higher interest rates are still putting a damper on growth. LOW shares slipped a bit on the news.
