Retailers and other consumer companies rose as traders bet that mortgage rates would soon peak.
Despite assurances to the contrary from the Federal Reserve, investors suspect the central bank is preparing for a pivot on rate policy.
Bed Bath & Beyond shares slid after the troubled retailer raised at least $225 million in a preferred-share sale designed to avert bankruptcy. The share sale, which analysts at brokerage Wedbush Securities described as a "last gasp" survival attempt, will dilute the ownership of existing shareholders. A rally for "meme" stocks stalled.
GameStop shares tumbled by 13%, the biggest drop since May 2022.
Children's Place rose after analysts at brokerage Telsey Advisory Group said the kid's clothing chain made the right decision in taking a near-term hit on inventory adjustment during the current retail slump and should benefit from falling cotton and air-freight costs in the second half of the year.
Write to Rob Curran at rob.curran@dowjones.com
(END) Dow Jones Newswires
02-07-23 1729ET
