Tuesday,
August 30, 2022
Market recap
Dow Jones
32,098.99
-184.41 (-0.57%)
S&P 500
4,030.61
-27.05 (-0.67%)
Nasdaq
12,017.67
-124.04 (-1.02%)
Top Story
Stocks Fall and Yields Rise As Concerns Mount Over Hawkish Fed
• US stocks fell Monday as investors continued to react to Federal Reserve Chair Jerome Powell’s comments from last week. Powell noted the Fed is committed to bringing inflation under control, even if that causes a recession or harms the job market.
• Government bond yields rose as the Fed’s hawkish stance weighed on equities. Over the past month there had been optimism on Wall Street that rate hikes could start to slow. Now the expectation is for another 75-basis-point hike at next month’s meeting. All three major indexes have seen their August gains wiped out.
• According to the Dallas Fed’s Manufacturing Index, the region’s activity showed slowed growth in August. The new orders index was negative for the third straight month, which indicates falling demand.
What to Be on the Lookout for Today
• The July Job Openings and Labor Turnover survey, or JOLTs report, is due. This tracks both job openings and layoffs during a given month. June’s report showed job openings fell to hit a nine-month low, but there was no significant uptick in layoffs.
• June’s S&P Case-Shiller Home Price Index will also be published, after it declined for the second-straight month in May. The Conference Board’s August Consumer Confidence Index is due as well, after falling for the third-straight month in July.
• Pet products ecommerce site Chewy (CHWY) will hand in its latest report card. This past Friday marked National Dog Day, and Chewy partnered with Blue Buffalo pet food (GIS) to offer e-gift cards for customers who spent over a certain amount.
Benefits of Direct Deposit
After the set-up process, using direct deposit has more benefits than drawbacks for many people. Some benefits of direct deposit include:
Convenience. Direct deposit means getting paid on payday whether or not an employee is in the office. A person using direct deposit could be at work, on vacation, or out sick, and their paycheck will still appear in their account.
Time-saving. Employees don’t need to head to the bank or ATM or use their banking app to upload a paycheck. Typically, direct deposit is instant, and the payee doesn’t need to do anything on their end.
Environmentally friendly. Using direct deposit can help reduce a payee’s carbon footprint on payday since there’s no physical check to print out and no need for a postal service to deliver it.
Secure. An automatic direct deposit means no keeping track of a paper paycheck. If an employee has signed the check and for some reason can’t cash it immediately, that could be a scary scenario if the check is lost.
More control of the flow of money. Depending on how a person sets up their direct deposit, they can designate where the money goes each payday. That means sending a portion of the deposit directly into savings, or multiple savings accounts for different goals. That could mean saving more in the long run.
With SoFi Checking and Savings®, members can easily set up direct deposit to their checking and savings account and earn interest on all the cash they deposit, without incurring account fees.
A Few Headlines That Should Be on Your Radar
Amid the current economic slowdown, US firms are wondering if now is the time to resume paying dividends. Of the companies that put dividends on pause in 2020, 72 or 38.5% have yet to reinstate the payouts. Some companies are choosing not to restart dividends while focusing instead on paying down debt or buying back shares. But dividends are important to shareholders and they send signals to the market. Here’s how several firms are evaluating the decision process. Read more >> Retailers are grappling with double trouble: excess inventory and increasingly skittish consumers. Meanwhile, pandemic-induced supply chain snarls continue to impact their bottom lines, all while inflation changes shoppers’ behavior. Competition for consumers’ dollars is expected to be fierce as inflation is motivating shoppers to be more conservative with their spending. Now there’s a scramble to sell off unwanted merchandise in advance of the all-important holiday shopping season. Read more >> For the EV industry, growth is being held in check by batteries. Now that new legislation offers tax breaks for EVs that source at least part of their batteries from US firms, that’s especially true. Honda (HMC) and LG Energy Solution announced a deal to build a $4.4 billion factory in Ohio where batteries will be produced for new EVs. It’s a big part of where Honda wants to go by 2040. Read more >> It’s tempting to spend money when bored, either in person or online. But it can keep you in debt. Overspending isn’t good for anyone’s budget or debt ratio. Learn 11 tips to stop shopping out of boredom and protect your hard-earned cash. Read more >>Not-So-Breaking News
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Panera Bread (PNRA) is testing out artificial intelligence technology at two of its locations in upstate New York. The goal is to use the tech to take customers orders in a faster and more efficient manner. Roughly 45% of Panera’s stores have drive thru lanes.
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Pinduoduo (PDD), a Chinese company that connects agricultural producers and consumers, saw its profit more than triple in its most recent quarter. Revenue also exceeded expectations. Executives cited a recovery in consumer sentiment, particularly during China’s June 18 shopping festival.
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Shell (SHEL) is warning that Europe could face natural gas shortages in the coming winters as a result of reduced outflows from Russia. CEO Ben van Beurden says solutions will be required during that time, all while European gas and power prices hit new records last week.
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Boeing (BA) announced it received an order from UPS (UPS) for eight additional 767 freighters. Delivery is scheduled to begin in 2025 and will result in UPS having 108 of the freighters in total. Boeing executives say the order speaks to the 767’s exceptional cargo capabilities.
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Walmart (WMT) made a $377.6 million offer to acquire the remaining 47% of South African retailer Massmart (MMRTY) that it does not already own. Reports indicate Walmart plans to delist the company if the deal goes through. Massmart’s chairman described the offer as “fair and reasonable,” as it represents an over 50% premium on its share price.
Financial Planner Tip of the Day
“Many checking accounts charge monthly maintenance fees, but you may be able to have them waived if you can meet certain requirements. Most commonly, you can skip the monthly fees if you set up direct deposits or maintain a certain account balance.”
Brian Walsh, CFP® at SoFi