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Dow Falls Over 300 Points To Enter Bear Market Territory, Nation’s Economic Growth Slows
• US stocks fell Monday as the Dow entered bear market territory. It was a volatile session that saw the three averages whipsaw back and forth between gains and losses.
• The US dollar strengthened, weighing on equities. This is due to the Fed’s rate hike campaign as well as policy in the UK that will see the government take on debt. A stronger dollar wreaks havoc on international trade and harms international corporation’s profits due to the unfavorable exchange rate.
• The Chicago Fed National Activity Index showed economic growth stalled in August. Technically speaking it declined from July to neutral or flat growth.
What to Be on the Lookout for Today
• The Conference Board will publish its Consumer Confidence Index for September. In August, consumer confidence rose more than expected, following three straight months of declines.
• July’s home price index is due from both S&P Case Shiller and the FHFA, as well as August’s new home sales. The rising-rate environment has put pressure on the real estate sector so investors will want to see how pricing and transactional volume are being impacted.
• Heating and plumbing products distributor, Ferguson (FERG) will report earnings. The company announced it was collaborating with Ford (F) to help test out the automaker’s F550 Fuel Cell Prototype. The first-of-its kind work truck will be used within Ferguson’s fleet on a daily basis for six months.
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A Few Headlines That Should Be on Your Radar
Walmart (WMT) is entering into the metaverse In partnership with online gaming platform Roblox (RBLX). The company filed several related trademarks, indicating they may be interested in selling NFTs and issuing digital currency. The big-box retailer says it won’t make money directly off the metaverse to start. But there’s plenty consumers can experience – especially younger ones – and that’s what has Walmart excited. Read more >> August marked the first decline in asking rents in almost two years. But truly substantial relief is going to take some time. It was a modest month-over-month decline, and prices remain elevated on an annual basis. Plus, it could be some time before renters get substantial relief, thanks to how most leases are structured. Read more >> Experts are forecasting an expensive holiday season this year. But these strategies can help your budget absorb the higher costs. So what are consumers supposed to do this year as inflation eats into their purchasing power? Learn about how “reward stacking” and credit card referral programs can help. Read more >> Trying to rent in a tight housing market? Here’s 4 steps to win the lease. These steps can help you anticipate what landlords are looking for and help you present yourself as the ideal tenant. Read more >>Not-So-Breaking News
- As Apple (AAPL) looks to move some of its manufacturing away from China, the tech giant announced its flagship iPhone 14 and iPhone 14 Plus will be assembled in India. This production is taking place at iPhone assembler Foxconn’s (2354) factory, located on the outskirts of Chennai. Apple says its goal is to make 25% of all iPhones in India by 2025.
- Another retailer has announced its holiday season hiring plans, as Dick’s Sporting Goods (DKS) is looking to hire as many as 9,000 seasonal associates. That’s down from last year’s 10,000 but up from the 1,000 hired in 2020. Just last week both Walmart (WMT) and Target (TGT) disclosed their holiday hiring plans.
- Chinese EV maker Li Auto (LI) cut its delivery outlook and said supply chain constraints are directly to blame. It now expects to deliver 25,500 vehicles in the third quarter after previously predicting between 27,000 and 29,000 units. Meanwhile, Beijing announced it’s extending China’s tax break for electric car purchases, which boosted Li Auto’s competitors Nio (NIO) and Xpeng (XPEV).
- The Biden administration proposed a rule that would require airlines and travel agencies to be more transparent about fees. Extra charges for things like checked baggage and advanced seat selection would need to be disclosed. This is in line with the White House’s earlier pursuit of stricter rules regarding airlines’ passenger refunds.
- The British pound hit a record low against the US dollar after the new UK government announced it will implement tax cuts and investment incentives in a bid to spur growth. Opponents of the policy argue it will force the UK to take on high levels of debt amid a rising rate environment.
Financial Planner Tip of the Day
"One thing to know about investing is that consistency can pay off in the long run. Even if you’re only able to invest a little money at a time through 401(k) contributions or by purchasing partial or fractional shares of stock, those amounts can add up as the years and decades pass."
Brian Walsh, CFP® at SoFi