Retailers and other consumer companies experienced a boost in the market, with consumer discretionary stocks leading the charge. This surge was fueled by a series of positive economic data.
One factor contributing to the improved outlook is the currently strong labor market and decreasing inflation rates. In July, the University of Michigan’s consumer sentiment index reached a 22-month high of 71.6. This indicates that consumers are increasingly optimistic about economic conditions. The positive sentiment is further supported by signs of decreasing pay and price pressures, suggesting that inflation is moving closer to the Federal Reserve’s desired level.
Despite higher prices, shoppers are still willing to pay for everyday items such as razors and toothpaste. This has positively impacted sales at Procter & Gamble, even though volumes have slightly declined. The consumer-products company implemented a 7% price increase across its brands in the June quarter compared to the previous year. This follows two consecutive quarters in which prices were raised by approximately 10% year over year.
In an effort to dissociate from rapper Kanye West, Adidas is planning to release a second batch of Yeezy-branded sneakers next month. This move comes as the company aims to reduce its inventory and shift its focus away from the controversial musician.
However, Ford shares experienced a drop after the automaker achieved a beat-and-raise quarter. Investors were spooked by the company’s decision to adjust its electric vehicle (EV) production goals.
On a positive note, Tupperware shares continued their remarkable rally, with the stock more than doubling in value over the span of a single week.
