For months, the conventional wisdom on the U.S. economy has been that, while there are numerous headwinds and headline risks to both the market and the underlying health of the economy, there has been an unwavering bright spot in the consumer. Earnings from the biggest banks on Wall Street appeared to only strengthen that belief, with every bank with a major U.S. retail arm ー from Chase to Citi to Wells Fargo ー noting strength in consumer spending.
That theory is now being put to the test. Retail sales for September came out Wednesday morning, showing the first decline in seven months. Overall sales fell 0.3 percent in September compared to estimates that called for a 0.3 percent increase, according to analysts polled by both Bloomberg and Reuters. It was the first decline since February of this year.
Jonathan Corpina, a senior managing partner at Meridian Equity Partners who trades on the floor of the NYSE, told Cheddar that the retail numbers point to a "double edge" in the economy. "Economically, our policies have gotten better," he said. "But there's still so much uncertainty."
"It's hard for individuals and companies to really make large, long-term investments at this point," Corpina said. Between Brexit, tariffs, trade, Fed policy, and presidential tweets, there is deep ambiguity that is giving investors pause, and Corpina said it's unlikely that's going to change before next year's election.
"The market continues to take two steps forward, one step back," he said.
Still, retail sales are just a "piece of the puzzle" that should be taken in context, especially with the indications from the the big banks that clients are still spending, and they are still lending. Consumer spending makes up more than two-thirds of the U.S. economy and has been growing at a brisk quarterly clip. Now the question is whether third-quarter data will show that a slowdown is spreading from the manufacturing sector to the consumer.
Upward revisions from the Commerce Department for August also helped soften the blow of the September surprise. Spending was particularly weak in auto dealerships, which saw a 0.9 percent drop, the largest since January. When excluding auto sales, gasoline, retail sales were essentially flat.
The Rev. Al Sharpton is set to lead a protest march on Wall Street to urge corporate America to resist the Trump administration’s campaign to roll back diversity, equity and inclusion initiatives. The New York civil rights leader will join clergy, labor and community leaders Thursday in a demonstration through Manhattan’s Financial District that’s timed with the anniversary of the Civil Rights-era March on Washington in 1963. Sharpton called DEI the “civil rights fight of our generation." He and other Black leaders have called for boycotting American retailers that scaled backed policies and programs aimed at bolstering diversity and reducing discrimination in their ranks.
President Donald Trump's administration last month awarded a $1.2 billion contract to build and operate what's expected to become the nation’s largest immigration detention complex to a tiny Virginia firm with no experience running correction facilities.
Chipmaker Nvidia is poised to release a quarterly report that could provide a better sense of whether the stock market has been riding an overhyped artificial intelligence bubble or is being propelled by a technological boom that’s still gathering momentum.
Cracker Barrel said late Tuesday it’s returning to its old logo after critics — including President Donald Trump — protested the company’s plan to modernize.
Low-value imports are losing their duty-free status in the U.S. this week as part of President Donald Trump's agenda for making the nation less dependent on foreign goods. A widely used customs exemption for international shipments worth $800 or less is set to end starting on Friday. Trump already ended the “de minimis” rule for inexpensive items sent from China and Hong Kong, but having to pay import taxes on small parcels from everywhere else likely will be a big change for some small businesses and online shoppers. Purchases that previously entered the U.S. without needing to clear customs will be subject to the origin country’s tariff rate, which can range from 10% to 50%.
Southwest Airlines will soon require plus-size travelers to pay for an extra seat in advance if they can't fit within the armrests of one seat. This change is part of several updates the airline is making. The new rule starts on Jan. 27, the same day Southwest begins assigning seats. Currently, plus-size passengers can pay for an extra seat in advance and later get a refund, or request a free extra seat at the airport. Under the new policy, refunds are still possible but not guaranteed. Southwest said in a statement it is updating policies to prepare for assigned seating next year.
Cracker Barrel is sticking with its new logo. For now. But the chain is also apologizing to fans who were angered when the change was announced last week.
Elon Musk on Monday targeted Apple and OpenAI in an antitrust lawsuit alleging that the iPhone maker and the ChatGPT maker are teaming up to thwart competition in artificial intelligence.
