Consumer staples companies fell across the board on Friday, after a stronger-than-expected September jobs report raised concerns it may lead the Federal Reserve to again hike interest rates.
A move is not certain, as the Fed is more focused on inflation than employment. But the 336,000 gain in new jobs was twice as large as expected. And job gains in August and July were bigger on second look.
“At any rate, the robust employment data for September paves a difficult road ahead for the Fed as they navigate the economic data and fine tune monetary policy for the months ahead,” said Charlie Ripley, senior investment strategist for Allianz Investment Management.
See: Live Coverage: September jobs report
The S&P 500 Consumer Staples Sector Index was last down 2.7% to put it on track for its worst one-day performance of the year. The index fell 2.65% on Jan. 18.
Companies have struggled in the current high inflationary environment that has made consumers more wary about spending.
Among individual components, Walmart Inc.
WMT,
was down 4.2% and has fallen for three of the past four sessions. Costco Wholesale Corp.
COST,
was down 4.3% and was on pace for its largest percent decrease since December 1, 2022, according to Dow Jones Market Data.
Dollar General Corp.
DG,
was down 2.8% and Dollar Tree Inc.
DLTR,
was down 2.2%. Conagra Brands Inc.
CAG,
was down 2% and Kellanova
K,
was down 2.9%.
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The latter is the former Kellogg Co., which split in two at the beginning of this week with Kellanova housing the company’s snacks, frozen foods and international cereals company, while WK Kellogg
KLG,
houses its North America cereals business. The stock has fared poorly and is down 11.5% on the week, while WK Kellogg has fallen 30%.
See also: Dollar-store stocks slide and UBS says Chinese discount websites may be their next challenge
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