Shares of retailers and other consumer companies ticked down, as traders hedged their bets on the outlook for inflation and Federal Reserve policy.
McDonald's shares declined as traders bet its growth had peaked in the short term after the company said price increases helped drive profit growth in the latest quarter. The burger chain said sales were now surpassing pre-pandemic levels across the world as more of its dining rooms reopened and new chicken items on the menu prove popular.
Similarly, Starbucks, one of the first major corporations to feel the pinch from the pandemic, said its sales had topped prepandemic levels. Starbucks shares fell after it warned that higher labor and supply costs are likely to linger for months, adding that it is promoting higher-end beverages such as cold coffee and could lift prices in areas to help compensate.
Starbucks' comments were the latest hint that a spike in inflation may not be as "transitory," as Fed officials have forecast.
Write to Rob Curran at rob.curran@dowjones.com
(END) Dow Jones Newswires
07-28-21 1641ET
