A trader works on the floor of the New York Stock Exchange (NYSE) in New York, August 3, 2022.
andrew kelly | Reuters
Here are the most important information investors need to start their trading day:
1. Stock futures fall
Stocks emerged on a rough Wednesday morning a day after the Dow Jones and S&P 500 ended higher. The three main indexes were in the red before the bell. The Dow Jones is on a five-day winning streak, while the S&P is looking for its fifth consecutive week of gains. On Wednesday, investors digest earnings from Target and Lowe’s a day after Walmart and Home Depot released their results. They are also eagerly waiting for the Federal Reserve to release the minutes of its previous meeting, as the central bank considers its next steps to fight inflation.
2. Inventory reduction compresses target profit
Shares of Target closed more than 4% higher on Tuesday after big-box rival Walmart posted better-than-expected results and stayed true to its guidance for the second half of the year. On Wednesday, however, Target reported earnings well below Wall Street expectations, even though revenue was in line with projections. Executives said they would rather deal a short-term blow to the company’s bottom line than stretch the pain out over time as it seeks to unload piles of unwanted goods ahead of the holiday season. However, Target stuck to its guidance for the full year and said it was in a better position to rebound.
3. Walmart CEO: Everyone is looking for a penny
Speaking of Walmart, the nation’s largest retailer and grocer is also struggling with excess inventory in some categories, but is benefiting from grocery sales and an influx of new customers. With inflation at its highest level in 40 years, more families with incomes of $100,000 or more are shopping at the discounter, the company said. “People are really focused on price now, regardless of income level,” Walmart CEO Doug McMillon told CNBC’s Courtney Reagan on Tuesday. “And the longer it lasts, the more it will be.”
4. Mortgage demand falls
Rates are down from their highs, price growth has slowed and sales are slowing, but that doesn’t mean people are getting back into the housing market. The Mortgage Bankers Association said Wednesday that demand for mortgages last week fell to its lowest level since 2000. Fewer people are also refinancing their mortgages as rates nearly doubled from earlier this year. Wednesday’s report follows new surveys showing more and more people are opting out of home-buying deals.
5. New Amazon union effort
Amazon workers at Amazon’s LDJ5 warehouse rally in support of the union on April 24, 2022 in Staten Island, New York. The union vote at LDJ5 was defeated on May 2, 2022.
Andrew Lichtenstein/Corbis via Getty Images
Union organizers at an Amazon warehouse near Albany, New York, have filed a petition to form a union. The workers are seeking representation from the grassroots Amazon Labor Union, which previously organized an Amazon warehouse in Staten Island. The e-commerce giant, which relies on workers in its massive warehouse network to quickly distribute products to customers, is battling union efforts at various facilities, including in Alabama and Kentucky.
– CNBC’s Tanaya Macheel, Melissa Repko, Diana Olick and Annie Palmer contributed to this report.
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