A number of stocks fell in the afternoon session after a hotter-than-expected wholesale inflation report fueled concerns about slowing consumer spending. The market was rattled by a Labor Department report showing the Producer Price Index (PPI), a measure of wholesale inflation, jumped 0.9% in July, significantly exceeding economists' expectations of a 0.2% rise. This was the largest monthly increase since March 2022, reigniting worries that businesses will be forced to pass higher costs on to consumers, who are already showing signs of price sensitivity. This inflation data has fanned concerns that U.S. tariffs on imported goods could start to translate into higher prices for shoppers. The inflation report landed amid growing evidence of consumer caution, with recent reports highlighting that shoppers are cutting back on non-essential spending, seeking out sales, and trading down to cheaper brands.
A number of stocks jumped in the afternoon session after markets continued to rally amid growing investor optimism for a Federal Reserve interest rate cut in September. This optimism was spurred by a recent Consumer Price Index (CPI) report that did not show runaway inflation, increasing the perceived probability of a rate cut to over 90%. Lower interest rates are generally seen as a positive for the economy as they reduce borrowing costs for consumers, which can stimulate spending on non-essential goods. Consequently, investors bid up shares in the apparel, home furnishings, and automotive retail industries in anticipation of stronger consumer demand.
The financial markets are currently riding a wave of optimism, largely fueled by the anticipation of an interest rate cut by the Federal Reserve. This bullish sentiment, which has seen major stock indexes like the S&P 500 (SPX), Nasdaq (IXIC), and Dow Jones Industrial Average (DJIA) reach new record
Shares of young adult apparel retailer American Eagle Outfitters (NYSE:AEO) fell 3.1% in the morning session after new data revealed a significant drop in in-store foot traffic, raising concerns that a controversial ad campaign is failing to drive sales. Data from retail analytics firm pass_by showed that for the week ending August 9, in-store visits to American Eagle fell 8.96% year-over-year. This followed a 3.9% decrease in the prior week, marking the largest two-week decline in store traffic in over a year. While the campaign, featuring actress Sydney Sweeney, generated significant online buzz and increased web traffic, it has not translated into higher sales or market share, which has remained relatively flat. Analysts had previously cautioned that the social media attention was not reflected in Google search trends for the company's products, and the new foot traffic data appears to validate those concerns.
Retailers are adapting their business models as technology changes how people shop. Still, secular trends are working against their favor as e-commerce continues to take share from brick and mortars.
This puts retail stocks in a tough spot, and over the past six months, the industry has pulled back by 2%. This drop was disheartening since the S&P 500 gained 5.7%.
Value investing has created more billionaires than any other strategy, like Warren Buffett, who built his fortune by purchasing wonderful businesses at reasonable prices.
But these hidden gems are few and far between - many stocks that appear cheap often stay that way because they face structural issues.
Great things are happening to the stocks in this article.
They’re all outperforming the market over the last month because of positive catalysts such as a new product line, constructive news flow, or even a loyal Reddit fanbase.
Shares of young adult apparel retailer American Eagle Outfitters (NYSE:AEO) jumped 6.3% in the afternoon session after continued positive sentiment after President Donald Trump praised the company's recent advertising campaign featuring actress Sydney Sweeney. The gain built upon a massive surge on August 4th, when the stock jumped over 23% for its biggest one-day leap since 2000. That initial spike followed a social media post where Trump called the ad the 'HOTTEST ad out there,' pushing the stock into meme territory. While the endorsement created significant market interest, some reports cautioned that the rally was driven by hype rather than the company's underlying financial health, which they described as having weak margins.
American Eagle Outfitters Inc (NYSE: AEO) shares are trading lower on Tuesday, pulling back from a sharp surge higher to start the week. Here's a look at what's going on.
A number of stocks jumped in the afternoon session after markets rebounded following a sharp sell-off in the previous trading session as a weaker-than-expected July jobs report fueled investor hopes for a potential interest rate cut. The U.S. economy added only 73,000 jobs in July, falling well short of the 110,000 expected by economists. This disappointing data has led to a dramatic shift in market sentiment regarding the Federal Reserve's next move. According to the CME FedWatch Tool, the probability of a September interest rate cut has surged from around 40% to over 80%. Lower interest rates generally stimulate the economy by making borrowing cheaper for consumers. This can lead to increased spending on discretionary items, such as apparel and home goods, which directly benefits consumer retail companies. The prospect of more accommodative monetary policy is therefore boosting investor confidence in the sector's outlook.
American Eagle Outfitters Inc. (NYSE:AEO) surged as much as 20% by early afternoon Monday after an unexpected endorsement from President Donald Trump lit up Truth Social — and the stock market.
Stocks sold off to end the week as negative overshadowed solid earnings reports from the mega-cap tech companies, which show the AI trade is alive and well
A number of stocks fell in the afternoon session as the broader market tumbled in the morning session after a surprisingly weak U.S. jobs report and the announcement of new, widespread tariffs on imported goods. The U.S. economy added only 73,000 jobs in July, falling far short of the 109,000 forecast. Compounding the issue, job gains for May and June were revised down by a combined 258,000, signaling what some see as “increasing signs of fragility” in the labor market. Simultaneously, the White House announced new tariffs, ranging from 10% to 41%, on goods from 92 countries. This “double whammy” of negative news has intensified fears that ongoing trade wars are damaging the U.S. economy. The combination of a weaker labor market and new trade barriers has rattled investor confidence, fueling expectations that the Federal Reserve may be forced to cut interest rates to support the economy.
