Dow Jones Industrial Average (^DJI +2.49%) is down 30 points this afternoon after a six-day rally for both the Dow and S&P 500. One tidbit of economic news for investors to note is that the National Association of Realtors said existing-home sales in May increased 4.9% to an annual rate of 4.89 million units -- the largest increase in nearly three years. As the housing recovery continues, albeit at a modest and sometimes unpredictable pace, it should provide some economic strength.
As we kick off the first trading day of the week, here are some retailers making headlines in the markets today.
Wal-Mart (WMT +0.63%) threw a counter-punch at The New York Times recently when it responded to columnist Timothy Egan. It's a good read, in fact, and if you have the time to glance it over, you'll be left with the impression that Wal-Mart needs to redesign its yellow smiley face to give it a huge smirk -- the image would fit perfectly at the top of its response. Here's how the response begins.
"Tim, Thanks for sharing your first draft. Below are a few thoughts to ensure something inaccurate doesn't get published. Hope this helps. -- WMT"
Despite Wal-Mart's enjoyable response, Egan's column is only the latest of many columns hounding the retailer about its practices, which include part-time contracts, low wages, and hurting small businesses. Wal-Mart will always face complaints regarding these issues.
One of Wal-Mart's strategies to improve its often maligned image is its "Made in America" effort. When the retailer announced in January 2013 its plan to buy $250 billion in U.S. manufactured products over the next 10 years, it was met with some skepticism. However, Wal-Mart has again beefed up its efforts to increase apparel and textile production in the U.S., and over time its push for more American products could prove a boon to its reputation. Stay tuned.
CarMax retail store. Source: CarMax press kit.
In other retail news, CarMax Inc. (KMX +4.10%) soared on Friday after posting its fiscal first-quarter earnings. Net sales and operating revenue drove 13.3% higher to $3.75 billion, topping estimates. Total unit used sales rose 9.8%, but more importantly, its used-unit sales in comparable stores increased 3.4%. CarMax's net earnings jumped 15.7% to $169.7 million for net earnings-per-diluted-share growth of 18.8% to $0.76.
Demand for used vehicles has risen in unison with the automotive industry's overall rebound in sales. As the job market continues to improve modestly and interest rates remain low, vehicle sales should continue to rise sustainably.
