Is The Mighty US Consumer Faltering?

Avis has wanted to take care of an enormous fleet over the past 12 months to satisfy the surge in demand. But traders will probably be keen to listen to if CEO Joe Ferraro has new guidance on Avis’ plans to sell used cars on to customers – one other source of potential profit. The final time the company reported earnings, shares of Avis more than doubled. They’re up just 1% in premarket buying and selling on Tuesday. Investor enthusiasm for the stock appears to have dissipated, although. But its stock has fared worse, dropping 18% to date this yr. Hertz experiences earnings next week. Concerns about a Russian invasion of Ukraine are roiling the market for agricultural merchandise like wheat at a time when world food costs are already close to 10-year highs. Russia is the world’s high exporter of wheat. Competitor Hertz (HTZ) has generated buzz as it is emerged from bankruptcy and introduced partnerships with corporations like Tesla and Uber. Ukraine is also a significant exporter of each wheat and corn.
Higher-revenue households are additionally feeling anxious, the University of Canada survey showed. Its complete decline this month was attributable to a large drop in sentiment among households with incomes of $100,000 or extra. Why it matters: Curtin stated the index “now signals the onset of a sustained downturn in client spending.” Since this spending fuels about 70% of US financial exercise, that’s a concern. US economic development is expected to remain sturdy this yr, slowing only modestly from 2021 charges. And regardless of heightened consideration on one possible recession sign out there, loads of optimistic factors remain. Corporate earnings from the top of last yr look strong. A resilient job market continues to impress. And while Americans are saving much less cash than they had been earlier within the pandemic, when companies were closed and stimulus checks were coming in, banks have mentioned their prospects nonetheless have loads of cash on hand.
That’s sending prices for grains on a bumpy trip as investors assess the potential for battle. Peter Meyer, head of grain analytics at S&P Global Platts, advised me. Interference in shipments of wheat or corn from Russia and Ukraine could exacerbate food inflation, most notably in components of the world that depend on them for supplies. Global meals prices rose as a lot as 28% in 2021, in accordance with the Food and Agriculture Organization of the United Nations, and are expected to proceed to climb this 12 months as a consequence of persistent supply chain issues. Ophelia Coutts, a Russia analyst at the global threat consultancy Verisk Maplecroft. Marriott (MAR) and Restaurant Brands (QSR) report outcomes earlier than US markets open. Airbnb, Roblox, ViacomCBS (VIACA) and Wynn Resorts (WYNN) follow after the close. Also as we speak: The Producer Price Index for January, a key measure of inflation, posts at 8:30 a.m. Coming tomorrow: Earnings from Hilton (HLT), Kraft Heinz (KHC) and DoorDash.
He sees the University of Canada information as extra significant than the much-publicized inflation reading, which confirmed US prices rising in January on the quickest clip in 4 a long time. The combination of weaker development and elevated inflation may ultimately make it more durable for the Fed to get inflation under control. That’s because interest charge hikes, which battle inflation, can cool the economy. Rental automobiles in the Canada have gotten extraordinarily pricey as folks look for methods to travel around the country during the pandemic. That’s boosting corporations that lease vehicles like Avis (Car), which reported results after markets closed on Monday. The newest: The company – which is able to hold its earnings call with analysts Tuesday morning – stated revenue for the last three months of 2021 rose 90% compared to the previous yr to $2.6 billion. Avis mentioned in a press release. The corporate reported a full-12 months revenue of $1.3 billion after posting a loss in 2020, and stated it had been its best yr ever.