Retail sales fell 0.9% in May, worse than expected as consumers pulled back
Retail sales declined 0.9%, even more than the 0.6% drop expected from the Dow Jones consensus. The decline reversed a 0.1% loss in April and came at a time of unease over tariffs and geopolitical tensions.
Excluding autos, sales fell 0.3%, also worse than the estimate for a gain of 0.1%.
However, excluding a series of items such as auto dealers, building materials suppliers, gas stations and others, sales increased 0.4%. That reading, known as the control group, is what the department uses when calculating gross domestic product.
.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
an hour ago
- Yahoo
Forget About Inflation! This Is a Much Bigger Threat to Wall Street.
Volatility has been readily apparent for the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite since 2025 began. Inflationary fears have been heightened by President Donald Trump's tariff and trade policy, as well as the rapid expansion of M2 money supply. However, there's no bigger threat to the stock market's rally than the earnings quality of Wall Street's most-influential businesses. These 10 stocks could mint the next wave of millionaires › Over the last century, the stock market has been a surefire moneymaker for patient, long-term-minded investors. Although other asset classes have increased in value over extended periods, including real estate, Treasury bonds, and commodities like gold, silver, and oil, none have come close to matching the annualized return of stocks. But just because the stock market offers a lengthy track record of making long-term investors richer doesn't mean Wall Street is free of volatility. Since the curtain opened for 2025, the benchmark S&P 500 (SNPINDEX: ^GSPC) and growth-focused Nasdaq Composite (NASDAQINDEX: ^IXIC) have both hit new highs. Additionally, the iconic Dow Jones Industrial Average (DJINDICES: ^DJI) and S&P 500 fell into correction territory, with the Nasdaq Composite enduring a short-lived bear market. Volatility tends to be driven by investor uncertainty and emotions. Though there's clear uncertainty at the moment concerning the prevailing rate of inflation and how rising prices might adversely impact stocks moving forward, a strong argument can be made that there's a much bigger threat to Wall Street than inflation. Let me preface this discussion by noting that a modest level of inflation is normal, healthy, and expected. When the U.S. economy is firing on all cylinders and expanding, it's expected that businesses will possess some level of pricing power that allows them to charge more for their goods and services. Historically, the Federal Reserve has targeted a prevailing rate of inflation of 2%. What has professional and everyday investors concerned is the potential for two variables to significantly increase the domestic inflation rate, which can have adverse consequences on corporate America, the U.S. economy, and the stock market. The first of these issues is President Donald Trump's tariff and trade policy. Following the close of trading on April 2, Trump unveiled his grandiose plan, which included a 10% sweeping global tariff, as well as higher "reciprocal tariff rates" on dozens of countries that have historically run unfavorable trade imbalances with America. For what it's worth, Trump has paused reciprocal tariffs on most countries until Aug. 1. The implementation of global tariffs comes with a host of potential problems, ranging from worsening trade relations with our allies to the possibility of foreign countries and/or consumers not buying American-made goods. But arguably the biggest worry of all with tariffs is their inflationary impact. Whereas output tariffs are applied to finished products imported into the country, input tariffs are duties assigned to goods used to complete the manufacture of products in America. Input tariffs run the risk of making U.S. goods costlier, and Trump's tariff and trade policy doesn't do a very good job of differentiating between output and input tariffs. An expected increase in the prevailing rate of inflation from Donald Trump's tariff and trade policy has even resulted in something of a "Trump bump" in Social Security's 2026 cost-of-living adjustment (COLA) forecast. The second variable that can cause the inflation rate to accelerate and remain well above the Fed's 2% target is the expansion of U.S. money supply. Similar to the prevailing rate of inflation, money supply is something we want to see growing at a modest rate. Expanding economies require added capital to facilitate transactions. Steady growth in money supply is one of the key markers of a healthy economy. What's specifically worth noting about U.S. money supply is the expansion we're witnessing in M2. This measure of money supply includes cash and coins in circulation, demand deposits in a checking account, money market accounts, savings accounts, and certificates of deposit (CDs) under $100,000. It's money that can be spent, but requires a little effort to get to. Over the trailing year, through May 2025, M2 money supply has increased by precisely 4%. It's the fastest year-over-year expansion in M2 since 2022 -- likely a result of the Fed kicking off a rate-easing cycle and making borrowing rates more attractive -- and it suggests a strong possibility of the U.S. inflation rate remaining stubbornly above 2%. But there's a much bigger downside threat to the stock market than inflation. The surface-scratching red flag for Wall Street is its valuation. When 2025 began, the S&P 500's Shiller price-to-earnings (P/E) Ratio, which is also known as the cyclically adjusted P/E Ratio (CAPE Ratio), was at its third-highest multiple when back-tested 154 years. Based on what history tells us, the previous five times when the S&P 500's Shiller P/E Ratio surpassed 30 and held this multiple for at least two months were eventually followed by declines ranging from 20% to 89% in the Dow Jones Industrial Average, S&P 500, and/or Nasdaq Composite. In short, the stock market has a track record of struggling when valuation premiums become extended to the upside. When stocks, collectively, trade at aggressive valuation premiums, it's often reflective of investor excitement over a next-big-thing innovation (e.g., artificial intelligence), as well as the result of strong earnings growth. But herein lies the real threat to Wall Street: Earnings growth has been a bit of a smoke-and-mirrors show for some of the stock market's leading businesses. Don't get me wrong -- some of Wall Street's most-influential businesses have blown the doors off of growth expectations with consistency for years. This includes Nvidia and Microsoft. But some of the stock market's top companies aren't nearly as operationally sound as they might appear -- and that's a problem. Electric vehicle (EV) maker Tesla (NASDAQ: TSLA) serves as a perfect example. On the surface, it's been profitable for five consecutive years and has relied on its first-mover advantages in the EV space, as well as its expansion into energy generation and storage, as a means to grow its sales and profits. But you might be surprised to learn that more than half of Tesla's pre-tax income has consistently derived from unsustainable sources, not from selling EVs or energy generation and storage equipment. In the March-ended quarter, Tesla reported $589 million in pre-tax income, of which $595 million came from selling regulatory automotive credits (which are given to it for free by federal governments) and $309 million in net interest income earned on its cash (less interest expenses). Without regulatory credits and interest earned on its cash, Tesla would have produced a $315 million pre-tax loss for the first quarter. Worse yet, President Trump's One Big Beautiful Bill, which was signed into law on Independence Day (July 4), is getting rid of automotive regulatory credits for EVs. Tesla is about to lose a 100% gross margin line item, which further exposes how poor its earnings quality truly is. Something similar can be said about Apple (NASDAQ: AAPL), but for different reasons. Apple's earnings quality comes under significant scrutiny if you back out the impact of its market-leading share buyback program. Since 2013, Apple has repurchased an almost unfathomable $775 billion worth of its common stock and retired in excess of 43% of its outstanding shares. Dividing net income by a shrinking number of outstanding shares has pushed earnings per share (EPS) higher and made the stock more fundamentally attractive to value seekers. But here's the issue: Apple's growth engine has stalled for years, and it's being completely masked by the company's outsized buyback program. In fiscal 2021 (ended Sept. 25, 2021), Apple delivered $94.7 billion in net income. For fiscal 2024 (ended Sept. 28, 2024), net income tallied $93.7 billion. Despite a $1 billion decline in net income over three years, Apple's EPS rose from $5.67 to $6.11, and its stock has rallied 44% since fiscal 2021 ended. In other words, the business has worsened from an income standpoint, but the company has added close to $750 billion in market value, which makes no sense. Therefore, although inflation is a headline story, it's the earnings quality of Wall Street's most-influential businesses that's the unequivocal threat to the stock market. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $425,583!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $40,324!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $674,432!* Right now, we're issuing 'Double Down' alerts for three incredible companies, available when you join , and there may not be another chance like this anytime soon.*Stock Advisor returns as of July 7, 2025 Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Microsoft, Nvidia, and Tesla. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. Forget About Inflation! This Is a Much Bigger Threat to Wall Street. was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Yahoo
Why Gray Media (GTN) Dipped More Than Broader Market Today
Gray Media (GTN) ended the recent trading session at $5.36, demonstrating a -4.63% change from the preceding day's closing price. The stock trailed the S&P 500, which registered a daily loss of 0.33%. Meanwhile, the Dow lost 0.63%, and the Nasdaq, a tech-heavy index, lost 0.22%. Shares of the broadcast television company witnessed a gain of 43.73% over the previous month, beating the performance of the Consumer Discretionary sector with its gain of 4.98%, and the S&P 500's gain of 4.07%. The upcoming earnings release of Gray Media will be of great interest to investors. The company's earnings report is expected on August 8, 2025. It is anticipated that the company will report an EPS of -$0.34, marking a 477.78% fall compared to the same quarter of the previous year. Regarding the entire year, the Zacks Consensus Estimates forecast earnings of -$0.72 per share and revenue of $3.15 billion, indicating changes of -121.43% and -13.67%, respectively, compared to the previous year. Investors should also pay attention to any latest changes in analyst estimates for Gray Media. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook. Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system. Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Currently, Gray Media is carrying a Zacks Rank of #3 (Hold). The Broadcast Radio and Television industry is part of the Consumer Discretionary sector. This industry, currently bearing a Zacks Industry Rank of 149, finds itself in the bottom 40% echelons of all 250+ industries. The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1. Don't forget to use to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Gray Media Inc. (GTN) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
5 hours ago
- Yahoo
Airbnb, Inc. (ABNB) Declines More Than Market: Some Information for Investors
Airbnb, Inc. (ABNB) closed at $135.34 in the latest trading session, marking a -1.21% move from the prior day. The stock's change was less than the S&P 500's daily loss of 0.33%. On the other hand, the Dow registered a loss of 0.63%, and the technology-centric Nasdaq decreased by 0.22%. The stock of company has fallen by 1.3% in the past month, lagging the Consumer Discretionary sector's gain of 4.98% and the S&P 500's gain of 4.07%. Investors will be eagerly watching for the performance of Airbnb, Inc. in its upcoming earnings disclosure. The company is forecasted to report an EPS of $0.92, showcasing a 6.98% upward movement from the corresponding quarter of the prior year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.02 billion, up 9.98% from the year-ago period. For the annual period, the Zacks Consensus Estimates anticipate earnings of $4.18 per share and a revenue of $12.02 billion, signifying shifts of +1.7% and +8.29%, respectively, from the last year. Investors should also take note of any recent adjustments to analyst estimates for Airbnb, Inc. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook. Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system. The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. Airbnb, Inc. is currently a Zacks Rank #3 (Hold). In terms of valuation, Airbnb, Inc. is presently being traded at a Forward P/E ratio of 32.81. This expresses a premium compared to the average Forward P/E of 22.17 of its industry. It's also important to note that ABNB currently trades at a PEG ratio of 2.57. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Leisure and Recreation Services industry held an average PEG ratio of 2.03. The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 71, which puts it in the top 29% of all 250+ industries. The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1. Be sure to follow all of these stock-moving metrics, and many more, on Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Airbnb, Inc. (ABNB) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
