Wall Street remains on edge as concerns over the health of the U.S. economy and American households weigh on market sentiment. Last week, U.S. stocks faced volatility, with the S&P 500 declining by less than 0.1%, the Nasdaq Composite falling 0.2%, and the Dow Jones Industrial Average dropping 0.6%.
the upcoming release of key U.S. economic indicators, including July’s consumer price index (CPI) and retail sales data, could further impact markets. Economists expect headline inflation to hold steady at 3%, while core CPI may slightly decrease to 3.2%. Investors are particularly focused on the numbers, as any signs of economic slowdown or persistent inflation could derail the recent stock market recovery.
Consumer spending has shown signs of weakening, with companies like McDonald’s and Airbnb reporting pressure from inflation on lower-income households. the strain on consumer wallets is evident, as many Americans have exhausted their savings from the pandemic, leading to more selective spending.
Upcoming earnings reports from major retailers, including Walmart and Home Depot, are expected to provide further insight into the state of consumer spending. Analysts warn that continued weakness in consumer spending could lead to broader economic challenges, including reduced hiring and income growth.
Despite these concerns, some analysts believe the market may see increased volatility without necessarily tipping into a recession. economic data will be crucial in determining whether U.S. economy is experiencing a gradual or sharp slowdown.