Walmart Slides as Yen Surges on US Consumer Worries

The Japanese yen strengthened sharply, extending gains after Japan’s election, as weak U.S. retail sales revived concerns about the health of American consumers. U.S. stocks softened, with consumer-linked names such as Walmart losing momentum after a strong rotation-driven rally. Asian markets were firmer, led by chipmakers, while Australia saw sharp moves as Commonwealth Bank jumped and CSL slumped heavily. Treasury yields eased as rate-cut expectations edged higher.

Equities

The FTSE 100 closed lower on Tuesday, slipping 0.3% after retreating from last week’s record highs. The decline was driven by sharp falls in heavyweight stocks, while the more domestically focused FTSE 250 ended the session higher, reflecting a clear split between large-cap pressure and mid-cap resilience.

Shares in BP closed more than 6% lower on Tuesday after the oil group suspended its share buyback programme and booked around $4bn of charges linked to renewables and biogas assets. Although quarterly profit met expectations, management’s decision to pause buybacks weighed heavily on sentiment. Standard Chartered also dragged the index down, with the shares falling nearly 6% after the Asia-focused lender announced the departure of chief financial officer Diego De Giorgi after just two years in the role.

Elsewhere in London, AstraZeneca closed about 2% higher on Tuesday. The drugmaker forecast steady growth in 2026, underpinned by strong demand for its cancer treatments, which helped offset broader weakness across the healthcare sector. Barclays reported a rise in annual profit and lifted its performance targets, but the shares still closed lower as banking stocks came under pressure across the market. Sterling and UK government bond yields were steadier after recent volatility, leaving equities largely driven by company-specific news.

In the United States, the S&P 500 and the Nasdaq Composite closed lower on Tuesday, while the Dow Jones Industrial Average edged up to a third consecutive record close. The S&P 500 ended the session down 0.33%, while the Nasdaq fell 0.59%, reflecting weakness in technology and communication services.

Shares in Alphabet closed lower after the company announced a $20bn bond sale, adding to investor unease around funding requirements tied to artificial intelligence investment. The move weighed on peers including Amazon, Meta and Microsoft, all of which face heavy spending plans this year.

By contrast, several consumer and technology names posted strong gains. Spotify closed almost 15% higher after forecasting first-quarter earnings above expectations, helped by user growth and price increases. Marriott ended more than 8% higher and hit a record high after projecting a sharp rise in fees from co-branded credit cards. Datadog surged more than 13% after beating quarterly estimates. On the downside, Coca-Cola closed lower after missing fourth-quarter revenue expectations, while S&P Global dropped nearly 10% after issuing a profit forecast below market expectations, pulling down peers across the sector.

Forex & Commodities

The Japanese yen strengthened further early this morning, extending gains that began after the weekend election delivered a decisive mandate to Prime Minister Sanae Takaichi. The currency traded firmer at 152.9 per dollar in Asian hours, continuing a rebound that has unsettled the US dollar, which slipped to 96.60 on the dollar index ahead of key US labour data later today. Sterling edged higher against the dollar to 1.366, though it weakened against the yen, reflecting the scale of the move in the Japanese currency rather than any shift in UK-specific news.

The Australian dollar also pushed higher, breaking above 0.7112 earlier today, its strongest level in around three years. The move followed renewed hawkish rhetoric from the Reserve Bank of Australia, with Deputy Governor Andrew Hauser reiterating that inflation remains too high and that policymakers are prepared to act. Markets are now more focused on the possibility of further rate rises after last week’s increase to 3.85, a stance that contrasts with the more cautious tone emerging from the United States.

Gold prices rose this morning as the softer US dollar and lower Treasury yields increased demand for non-yielding assets. Spot gold traded higher at $5,057 per ounce by mid-morning in London, while silver climbed to $82.44. The move followed US data released late on Tuesday showing weaker retail sales and slower growth in labour costs, reinforcing expectations that the Federal Reserve could still ease policy later in the year.

Oil prices also moved higher, supported by geopolitical tensions and signs of firmer demand from India. Brent crude was trading at $69.37 a barrel, while US West Texas Intermediate stood at $64.52. Prices firmed after comments from President Donald Trump suggesting the US could deploy a second aircraft carrier to the Middle East if talks with Iran falter. At the same time, Indian refiners increased purchases of Middle Eastern and West African crude as they reduced reliance on Russian supply, helping absorb surplus barrels lingering from late 2025.