Welcome to MarketBites! Here's all you need to know about yesterday's market news.
"Never let people who choose the path of least resistance steer you away from your chosen path of most resistance”
- David Goggins
PORTFOLIO MANAGER COMMENTARY
Markets edged slightly down on Wednesday after retail sales came in mostly in line with expectations. Target was an outlier as the company reported a decline in sales due to families dealing with high inflation. This resulted in lower-than-expected earnings for the quarter and a more depressed outlook for the holiday season. Target stock fell 13.14% on the day.
Lowe’s, on the other hand, says it is not seeing the negative effects of inflations as sales and profits top expectations. Lowe’s now expects full-year earnings of $13.65 to $13.80, up from $13.10 to $13.60. Lowe’s share price rose 2.97%.
Federal Reserve Governor Christopher Waller said Wednesday he’s open to reducing the level of interest rate increases to half a percentage point in December. “But I won’t be making a judgment about that until I see more data,” he said at a speech in Phoenix, where he also vowed not to be “head-faked” by an encouraging inflation report last week. The Fed’s benchmark rate currently sits in a targeted range between 3.75% and 4%.
CHART OF THE DAY
With the U.S. fertility rate in a decade-long slump and the life expectancy of 65-year-old Americans approaching roughly 85, our aging nation is likely to grow older by midcentury, as the ratio of young to old continues to decline. Charles Goodhart, an economist at the London School of Economics, argues in his 2020 book, “The Great Demographic Reversal,” that the slowing growth of the global workforce will cause worldwide economic growth to slow over the next three decades. (Only parts of sub-Saharan Africa, India and some other emerging economies are likely to see significant population gains, Prof. Goodhart and his co-author, Manoj Pradhan, say.)