Latest / Markets with Megan: A Quick Financial Markets Update / 035: The Latest Retail Sales Report: Winners, Losers, and Future Sustainability 08-15-23

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035: The Latest Retail Sales Report: Winners, Losers, and Future Sustainability 08-15-23 · Markets with Megan: A Quick Financial Markets Update

• 0:02
  Megan Horneman: Hello, welcome to Markets with Megan.
• 0:04
  Megan Horneman: This is Megan Horneman and the Chief Investment Officer for Verdence Capital Advisors.
• 0:08
  Megan Horneman: We're here today to talk a little bit about the retail sales report that came out today.
• 0:12
  Megan Horneman: This is a monthly report that gives us an idea of consumer spending.
• 0:16
  Megan Horneman: There's really no way to get around this.
• 0:19
  Megan Horneman: The headline's going to say it was a great report and underneath it was a very good report from a spending perspective.
• 0:25
  Megan Horneman: Here it was autos, furniture, electronics.
• 0:29
  Megan Horneman: Those areas were weak, but the rest of the areas of the report were very strong.
• 0:32
  Megan Horneman: When you look at internet sales, that's all the biggest monthly jump, and that was primarily due to Amazon's Prime Day.
• 0:39
  Megan Horneman: The first of the two days for Amazon's Prime Day was their single biggest selling day ever on record.
• 0:45
  Megan Horneman: So there still is that argument that consumers remain resilient.
• 0:49
  Megan Horneman: What we think, though, going forward, is that the combination of higher gasoline prices, as well as the resumption of student loan payments and as well as the amount of credit card debt that is outstanding, we're not sure how long this resiliency can stay.
• 1:04
  Megan Horneman: The consumers have been more resilient than we have anticipated.
• 1:08
  Megan Horneman: What the markets are doing today is selling off pretty substantially because of this news.
• 1:13
  Megan Horneman: The reason behind that is now.
• 1:15
  Megan Horneman: There's the thought that the Federal Reserve is not done with their tightening cycle.
• 1:19
  Megan Horneman: They're not going to like this report.
• 1:21
  Megan Horneman: This can be inflationary.
• 1:22
  Megan Horneman: We're going to take a close look at other spending metrics, especially inflation-adjusted spending, when we get that at the end of the month and then we'll get a better idea of what their path is.
• 1:32
  Megan Horneman: But equity markets are pricing in that the Fed is not done with their tightening cycle and we're seeing that in weakness today.
• 1:38
  Megan Horneman: If you have any questions or comments, please feel free to reach out to podcasts at verdence dot com.
• 1:43
  Megan Horneman: Thank you.