This week sees most of America’s biggest retailers report between Tuesday and Thursday, from the weekly shop at Walmart to a new kitchen at Home Depot. With the conflict in the Middle East still running, fuel prices have stayed high and volatile through the quarter they are reporting, raising the cost of moving stock and leaving shoppers less to spend once they have filled the tank. Higher fuel took 250 basis points off Walmart’s operating income growth in the quarter to 1 May.
Your week at a glance
Monday 17 August
• Canada CPI for July, 12:30 UTC. Headline inflation was 2.8% in June, down from 3.2% in May.
Tuesday 18 August
• UK labour market, 06:00 UTC. Unemployment was 4.9% in the three months to May.
• Before the US open: Home Depot, Klarna, Baidu. BHP publishes full-year results.
Wednesday 19 August
• UK CPI for July, 06:00 UTC. Headline inflation was 2.6% in June, core 2.6%.
• Minutes of the Federal Open Market Committee’s (FOMC) July meeting, 18:00 UTC.
• Before the US open: Lowe’s, Target, TJX, Analog Devices, Estée Lauder.
Thursday 20 August
• Australian labour force for July, 01:30 UTC. Unemployment held at 4.4% in June on employment growth of 76,300.
• Before the US open: Walmart, Alibaba, Deere.
Friday 21 August
• UK retail sales for July, 06:00 UTC.
• Flash purchasing managers’ indices (PMIs) for August. Germany 07:30 UTC, euro area 08:00 UTC, UK 08:30 UTC, US 13:45 UTC.
Off-price against big-ticket.
TJX comparable sales are running at 6 per cent against 0.6 per cent at Home Depot and Lowe’s. Target’s rose 5.6 per cent last quarter on higher footfall. Marvin Ellison has described Lowe’s core customer as a homeowner earning above $100,000 with record home equity whose appetite for big-ticket spending is still weak. Walmart has guided this quarter below what analysts expected. Its higher-margin advertising revenue grew 37 per cent last quarter.
The credit behind the basket
Klarna reports on Tuesday, having made $1.0bn of revenue in the first quarter financing retail purchases at the point of sale. Volumes through Fair Financing, its fixed-term product for larger buys, more than doubled over the same period.
UK inflation with the energy cap still to come.
July inflation arrives on Wednesday, the labour market on Tuesday and retail sales on Friday, all before the Monetary Policy Committee next sets Bank Rate. The committee held at 3.75 per cent last month by six votes to three.
Cheaper diesel and petrol pulled June inflation down to 2.6 per cent. The Bank expects it to peak at 3.2 per cent in the fourth quarter. July’s energy price cap rise has still to feed through.
Chinese cloud growth, weaker Chinese consumers
Alibaba reports the June quarter on Thursday. Cloud revenue grew 38 per cent in the March quarter, against a three-year AI commitment of RMB380bn (US$53bn).
Baidu reports on Tuesday, the day after China publishes July industrial production and retail sales. Its AI cloud infrastructure revenue grew 79 per cent in the first quarter. Online marketing services fell 22 per cent.
Estée Lauder closes its financial year on Wednesday and gives first guidance for the year to June 2027. Its May plan assumed mid single-digit retail sales growth across its China business.
Record iron ore into a copper deficit
BHP already published its production numbers in July: record iron ore output and copper close to 2Mt for a second year. The International Copper Study Group expects the refined copper market to run a deficit this year, with data centres, grid upgrades and electric vehicles all competing for the same supply. Tuesday adds unit costs, the capital programme and the dividend. Net debt finished June at about US$9bn, down from US$14.7bn in December. Rio Tinto lifted its own interim payout 43 per cent last month.