Summer Travel Barometer
Summer is officially in full swing. For many people — maybe even a record number — that means heading to the airport to catch a flight. But it’s been a bumpy start to the busiest travel season in recent memory, due to severe weather and staffing shortfalls. This is why Wall Street is eagerly awaiting the latest earnings report on Thursday from Delta (DAL).
Despite the turbulence, Delta and its competitors have echoed widespread projections of robust summer demand. Further tailwinds include jet fuel prices, which are roughly 30% lower year-over-year, as well as a surprising customer preference for luxury. Delta expects premium revenue from amenities like first class to make up 35% of its total sales.
Delta may also discuss its partnership with American Express (AXP), which has generated an estimated $6.5 billion this year. But traders and travelers alike may be most curious to learn more about Delta’s $1 billion push to offer free wifi on over 1,200 planes by 2024.
Will this summer mark a turning point for both demand and comfort in the air travel industry? Investors may find out in the week ahead on Wall Street.
Economic Data
The week will kick off with speeches from several Fed Presidents: Mary Daly of San Francisco, Loretta Mester of Cleveland, and Raphael Bostic of Atlanta. These speeches could provide clarity on if the Federal Reserve will continue to raise interest rates for the remainder of the year.
Tomorrow, the NFIB small business optimism index for June will be released. In May, this index indicated ongoing concerns among small business owners regarding future business conditions.
On Wednesday, the inflation rate for June will be released. In May, inflation slowed for the 11th consecutive month to 4%, driven mainly by a decline in energy prices.
On Thursday, producer price inflation for June will be released. In May, producer prices decreased 0.3% on a monthly basis. Additionally, a statement regarding the US government’s monthly budget will be released. In May, the US government reported a budget deficit of $240 billion, up from $66 billion the year before.
On Friday, US import and export prices will be released for June. In May, these metrics dropped 0.6% and 10.1% on an annual basis, respectively.
Earnings
Today, WD-40 (WDFC), the chemical company named after its signature product, will release earnings. The owner of Spot Shot and Carpet Fresh will look to improve after last quarter, when it reported a 15.3% year-over-year drop in net income.
Reports from major companies will remain relatively quiet until Thursday, when the week will pick up dramatically. Pepsi (PEP) and Progressive (PGR) are two big names that will report their latest results. Pepsi’s CEO will likely discuss the company’s controversial yet profitable decision to remain open in Russia despite its war with Ukraine.
Friday will be a marquee day for financial companies, with JPMorgan (JPM), BlackRock (BLK), and Citi (CITI) all announcing earnings. BlackRock CEO Larry Fink is sure to discuss the company’s recently-proposed Bitcoin ETF, as well as his statement that Bitcoin could “revolutionize” finance.
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