What: Walmart shares closed 8.1% lower after predicting weaker consumer spending during the holiday season.

Why it is important: The company's cautious holiday outlook for consumer spending reflects potential shifts in consumer behaviour and sentiment towards essential purchases amidst inflationary pressures.

Walmart's third-quarter revenue of USD 160.8 billion and adjusted earnings of USD 1.53 per share came in slightly ahead of expectations. Sales strength in the US operations was led by grocery and health categories, while general merchandise sales declined modestly.

The company raised hopes for relief from inflationary pressures, as grocery inflation starts to normalize and pricing on general merchandise comes down. Walmart is forecasting full-year net sales growth in the range of 5% to 5.5%, with adjusted earnings per share between USD 6.40 and USD 6.48.

Walmart stocks drops after forecasting cautious spending by consumers