Walmart Loses $10.39 a Share as Treasury Buyback Rally Dies After One Session

The relief rally lasted exactly one session. The S&P 500 (SPX) is down 22.61 points to 7,685.37, a loss of 0.29%, after closing Wednesday at 7,707.98. The Dow Jones Industrial Average (DJI) has shed 342.54 points to 53,120.51, off 0.64% and the worst of the three majors. The Nasdaq Composite (IXIC) is lower by 155.50 to 26,175.59, a decline of 0.59%. The Russell 2000 (RUT) sits at 3,014.24, down 18.71 points or 0.62%, giving back a chunk of the record it printed on August 14.

The single largest weight on the Dow is Walmart (WMT), which has been ripped for 9.09% to $103.91, a $10.39 drawdown that removed roughly $82 billion of market capitalization in a morning. Volume has already run 25.275 million shares against a three-month average of 23.909 million, and the print puts the stock $31.25 below its 52-week high of $135.16 with the low at $95.42 now within striking distance.

The bond market is the reason the tape rolled over. The 10-year yield has added better than four basis points to 4.696% after settling Wednesday at 4.647%. The 30-year is back up more than four basis points to 5.236% against Wednesday's 5.196% close. Both were falling twenty-four hours ago on the Treasury's buyback expansion. Both are rising now.

Crude blew higher again. West Texas Intermediate for September delivery trades at $86.40, up $2.01 or 2.38%, while Brent pushed through $94 a barrel in morning trade on a 2.9% gain. The catalyst was a Truth Social post declaring what the administration called the most crushing economic operation ever taken against any country, aimed squarely at Iran.

Volatility is bid but not panicked. The VIX sits at 15.54, up 0.65 or 4.37%, still a full point below the 16.50 level that usually marks the start of genuine hedging demand. Gold has slipped $8.30 to $4,537.00, off 0.18% and giving back a fraction of Wednesday's 2.7% surge.

Then there is the one asset class ripping. Bitcoin trades at $71,639.28, up $5,748.57 or 8.72%. Ethereum has added 15.63% to $2,277.20. The Treasury injected liquidity into the long end of the curve and the money went straight into the highest-beta corner of the market, not into equities.

The Buyback Trade Had a Twenty-Four Hour Shelf Life

Wednesday's move was mechanical. The Treasury announced it was increasing, by at least double, the size of liquidity support buyback operations for longer-dated nominal coupon securities across the 10-year to 20-year and 20-year to 30-year sectors. The per-operation ceiling goes from $2 billion to at least $4 billion, effective September 9 and running through November 4, per the Treasury's August 19 announcement.

The 30-year snapped from 5.33% — a level it had not touched since June 2007 — down 10 basis points to 5.184% inside of hours. The 10-year dropped from 4.68% to 4.637%. The dollar hit a three-month low. Equity futures ripped. The S&P closed up 0.21%, the Nasdaq up 0.16%, and the healthcare sector printed an all-time high on a 2.9% gain.

Thursday undid the yield move entirely. Both benchmarks are back above where they sat before the announcement landed, and the arithmetic explains why. The scheduled buyback window from August 6 through November 5 was already sized at up to $69 billion across all maturities. Three more operations in 20- to 30-year paper and four in 10- to 20-year securities remain in that window. Doubling the cap adds roughly $14 billion, bringing the theoretical maximum to $83 billion.

Against $32.2 trillion of outstanding marketable Treasury debt, $14 billion is 0.04%. It is four basis points of the float. The 30-year moved ten basis points on a headline that changes four basis points of supply arithmetic, which is the definition of a positioning squeeze rather than a repricing.

The buyback also does not retire a single dollar of debt. Treasury purchases older, less liquid coupons and finances the purchase by issuing new ones. Total outstanding does not shrink. The maturity ladder gets rearranged. That is the entire mechanism.

What it did do was signal. A mid-quarter revision to a buyback schedule published two weeks earlier breaks the department's own regular-and-predictable convention, and the market read that break correctly: the administration has decided the long end blowing out is unacceptable and will act off-calendar to stop it. Wednesday priced the signal. Thursday priced the fundamentals underneath it — a $432.3 billion July deficit, the largest monthly shortfall since March 2021, and a year-to-date gap approaching $1.8 trillion.

Walmart Beat on Revenue, Beat on EPS, and Lost Ten Dollars a Share

The headline numbers were clean. Walmart put up $187.94 billion in fiscal second-quarter revenue against a consensus near $186.77 billion, growth of 5.9% off the $177.40 billion booked a year earlier. Adjusted earnings came in at $0.81 per share against $0.74 modeled, and against the company's own prior guidance range of $0.72 to $0.74. Global e-commerce grew 23%. The gross profit rate expanded to 25.4%.

Management raised the full year. Fiscal 2027 net sales are now guided to grow 4.0% to 5.0% in constant currency with adjusted operating income up 7.0% to 8.5%, per Walmart's Q2 FY27 release. The prior framework called for 3.5% to 4.5% net sales growth and 6% to 8% operating income growth. That is an unambiguous lift on both lines.

The stock got destroyed anyway.

Reported net income landed at $6.37 billion, or $0.80 per share, against $7.03 billion and $0.88 a year ago. GAAP earnings fell 9.4% year over year on revenue that grew 5.9%. The $0.81 adjusted figure strips a loss on investments and folds in a benefit from a tax matter, which is a wider set of adjustments than the company usually needs to clear its own guide.

The gross margin expansion carries the same problem. The 25.4% rate was boosted by tariff refunds, and the company confirmed it is eligible for $2.9 billion of them with just under $100 million left to collect. That is a one-time cash event flowing through the margin line, and management said the money is going back out the door as price investment. So the margin does not repeat and the cash does not stay.

Advertising remains the real engine. Walmart Connect in the US grew 43% excluding VIZIO, on top of 36% growth in the prior quarter. Advertising and membership together now generate roughly a third of operating income. That is the structural argument for a 40.25 trailing multiple on a retailer.

None of it mattered. The market looked past a revenue beat, an EPS beat, and a raised full-year outlook, and priced two numbers instead — the comp and the third-quarter guide.

The 2.6% Comp Is the Number That Broke the Stock

Walmart US comparable sales grew 2.6% for the thirteen weeks ended July 31. Consensus sat at 3.5%. One sell-side shop had already cut its estimate to 3.5% from 4.0% ahead of the print, and another was modeling 3.6%. The actual number came in a full 90 basis points under the low end of what desks were carrying.

The company flagged an 80 basis point headwind from health and wellness inside that figure, which cleans the number up to roughly 3.4% ex-pharmacy. That still misses. And it represents a hard sequential deceleration from the 4.1% comp Walmart posted in the fiscal first quarter ended April 30 — a 150 basis point drop in a single quarter at the largest retailer in the United States.

The third-quarter guide made it worse. Net sales are guided to grow 3.0% to 3.75%. Adjusted operating income is guided to grow 2.0% to 4.0%. Adjusted EPS is guided to $0.62 to $0.64 against a consensus of $0.68.

Run the arithmetic on the operating leverage. In the quarter just reported, Walmart guided operating income to grow 7% to 10% against sales growth of 4% to 5% — profit compounding at roughly 1.9 times the rate of revenue. The third-quarter guide flips that. Sales grow 3.0% to 3.75%; operating income grows 2.0% to 4.0%. At the midpoints, profit now grows slower than sales. The flywheel that justified the multiple stopped spinning inside one quarter.

The base against which that guide is set is $177.8 billion in net sales, $7.3 billion in adjusted operating income, and $0.62 in adjusted EPS. Guiding to $0.62 at the low end means guiding to zero year-over-year earnings growth in the current quarter, at a company carrying an $826.92 billion market capitalization and a 40 times multiple.

The stock had been consolidating near $115.20 with resistance at $116.45. It opened Thursday at $103.88. The entire technical structure was erased before the conference call started at 8:00 a.m. ET.

Bitcoin Blows Through $71,000 and Takes the Leverage Complex With It

Bitcoin trades at $71,639.28, up $5,748.57 or 8.72%, after tagging an intraday high of $72,496. It is the first time the asset has cleared $70,000 since June 2. The two-day gain now exceeds 11% off a base near $63,000 earlier in the week, and the move ran from $64,920 to the highs in a matter of hours.

The mechanics were forced, not organic. Roughly $2.7 billion of crypto short positions were liquidated across the move, with more than $1 billion of Bitcoin shorts wiped out inside a single hour on Wednesday. Against a Bitcoin futures open interest base near $49 billion, that is more than 5% of the entire notional stack blown out in one cascade. Open interest has since climbed 9.29% in twenty-four hours to 758,200 BTC, or $52.61 billion in positions — price moved first, positioning chased.

Ethereum outran it. ETH is up 15.63% to $2,277.20, extending a seven-day gain near 20% and reclaiming ground it had not held since May. Solana ran 13.56% to $87.81. XRP added 14.71% to $1.15.

Two catalysts stacked. The Treasury buyback dropped long-end yields and weakened the dollar to a three-month low, which is the cleanest possible setup for a duration-free, supply-capped asset. Then the White House hosted the chief executives of Coinbase, Kraken, Robinhood, Ripple, Gemini and Chainlink and the President called on Congress to pass a fair version of the CLARITY Act before the end of the session.

That bill defines whether a digital asset is a security or a commodity and settles jurisdiction between the SEC and the CFTC. The Senate left for August recess without a vote, and the market had largely written it off for 2026. A cloture vote is now scheduled for September 15.

The context tempers it. Bitcoin remains 43% below its October 2025 record of $126,198, sits 24% under the $94,820 high printed in mid-January, and is down 18.22% year to date. The daily RSI reads 78.3. This is a squeeze inside a bear market, not a trend reversal, and the $71,000 to $76,000 zone is stacked with underwater long-term holders looking for an exit.

Strategy, Coinbase and the Miners Reprice Off a Single Headline

The equity proxies did what they always do — they levered the underlying and then levered it again. Strategy (MSTR) trades at $111.71, up $7.46 or 7.16%, on 14.514 million shares against a 20.963 million average. That comes on top of Wednesday's 12.68% close at $104.25, where volume hit 41.676 million shares, roughly double the norm. Two sessions, a 20.6% move, and the market capitalization back to $44.38 billion.

The stock is still down 69.12% over twelve months and sits $253.50 below its 52-week high of $365.21. A $71,600 Bitcoin does not fix a balance sheet built on an average cost basis accumulated across a very different price regime.

Coinbase (COIN) is at $170.92, up $10.72 or 6.69%, capitalized at $45.095 billion and still 46.65% lower year over year with a 52-week range of $139.11 to $402.16. MARA Holdings (MARA) has added 8.55% to $10.48 on 17.421 million shares. Bitdeer (BTDR) leads the miners at $10.53, up 9.35%. CleanSpark (CLSK) is up 4.62% to $12.21. Bitmine Immersion (BMNR) trades at $21.59, up 6.65%, on a $13.021 billion capitalization despite being down 57.59% on the year.

Galaxy Digital (GLXY) added 5.47% to $23.10. Twenty One Capital (XXI) ran 9.38% to $6.07 — a stock down 77.39% over twelve months with a 52-week high of $25.97. Bullish (BLSH) gained 4.74% to $28.20. Webull (BULL) tops the entire gainers board at $9.80, up $1.16 or 13.42%, on 15.732 million shares against an 11.878 million average.

Look at the composition of that list. Every name in the top ten gainers with meaningful size is either a crypto treasury vehicle, an exchange, or a miner. Nine of the twelve largest percentage advancers in the market are levered to a single asset price. Outside that basket, the gainers list thins immediately into energy — LandBridge (LB) up 7.85% to $88.65, Talos Energy (TALO) up 6.07%, Vista Energy (VIST) up 5.47%, SM Energy (SM) up 5.43%.

Crypto beta and oil beta. That is the entire long side of Thursday's tape.

Crude Rips Through $86 on Economic D-Day

WTI for September delivery trades at $86.40, up $2.01 or 2.38%, its fourth consecutive session of gains. Brent pushed 2.9% higher to $94.31 in morning trade. The spread between the two has widened past $7.90, which is the market pricing a waterborne supply problem rather than a domestic one.

The trigger was explicit. The President announced what he described as the most crushing economic operation ever taken against any country, framed as economic warfare and isolation on an unprecedented scale, and threatened tremendous economic consequences for any nation providing a financial lifeline to Tehran — specifically naming cash transfers, currency swaps and shipping registries.

That escalation landed on an already tight physical market. The Strait of Hormuz has been running well below the pre-war baseline of 130 to 140 daily transits since the conflict opened on February 28. The US naval blockade of Iranian ports remains in place with no stated end date. The United Arab Emirates halted all trade and financial transactions with Iran on Wednesday after saying it came under fire from the Islamic Republic on Tuesday.

Strategic Petroleum Reserve stocks have fallen below 300 million barrels, the lowest since January 1983. The buffer that absorbed the first six months of this shock is now largely spent, and the International Energy Agency has cut its global demand forecast specifically because of the Hormuz squeeze — demand destruction rather than supply relief doing the balancing.

Crude has traded a violent range this year. Brent printed above $113 in late March and pushed past $140 on dated benchmarks at the peak of the disruption. WTI cleared $116 in April, then collapsed below $70 in June when tankers briefly resumed transit. The August base has been $77.99 to $88.67 on the WTI September contract, and Thursday's $86.40 sits in the upper third of that band with the trend pointing higher.

The equity read-through is narrow and mechanical. Energy names are the only cyclical group holding a bid. Everything downstream of the oil price — transport, chemicals, consumer discretionary, anything with a fuel line item — is absorbing the cost. That is exactly what the Dow's 0.64% underperformance against the S&P's 0.29% is measuring.

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