{"id":77534,"date":"2025-08-18T00:38:07","date_gmt":"2025-08-18T00:38:07","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/77534\/"},"modified":"2025-08-18T00:38:07","modified_gmt":"2025-08-18T00:38:07","slug":"amber-kanwars-weekly-setup-canadian-inflation-and-big-box-retail-earnings","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/77534\/","title":{"rendered":"Amber Kanwar\u2019s Weekly Setup: Canadian inflation and big box retail earnings"},"content":{"rendered":"

This is the first time all summer that my husband and I have gotten away, just the two of us. It is not really for leisure: He\u2019s on a work trip and I\u2019m typing on a beach. There is also fallout from Air Canada\u2019s labour dispute<\/a> that could mean navigating a hellscape of travel upon our return. It\u2019s funny what passes as a vacation these days.<\/p>\n

Here are five things to know this week:<\/p>\n

(CP)I of the storm: With few earnings reports in Canada, inflation<\/a> will be the main reason for traders to show up to work this week. The Bank of Canada<\/a> will get its second last look at headline and core inflation on Tuesday morning before the next interest rate decision in September. Headline inflation is expected to cool thanks to lower shelter and gasoline prices. However, core inflation is expected to remain sticky at 3 per cent. <\/p>\n

We learned last week that the central bank decided to hold interest rates at its last meeting precisely because core inflation remains elevated \u2013 it has been above 3 per cent for three months now. \u201cThe BoC needs to see at least a couple of months (and probably three) of decelerating inflation before further rate cuts are on the table,\u201d wrote Benjamin Reitzes, managing director for Canadian rates and macro strategist at Bank of Montreal Capital Markets. <\/p>\n

Inflation will be a hot topic at the Jackson Hole Economic Symposium taking place in Wyoming toward the end of the week. Nearing the end of his term, Jerome Powell will give his remarks for the last time as Federal Reserve Chair. Investors will want to know how Mr. Powell is feeling about inflation after last week\u2019s data produced mixed results: lower consumer prices and significantly higher producer prices. The recent softness in the U.S. labour market may be the tipping point with investors betting on a September rate cut. <\/p>\n

Big box: Walmart Inc. is trading around record highs, while Target Corp. is languishing around a five-year low, and this week we will get a closer look at how these two big-box retailers are faring. While the two companies seem similar on the surface, grocery and everyday low prices have put Walmart in the pole position. But it also means that investors are now paying nearly 40 times earnings for Walmart compared to just 14 times for Target. <\/p>\n

Having said that, Walmart reports this Thursday and is expected to show an 11-per-cent increase in profit compared to a 23-per-cent drop for Target, which will report on Wednesday. Bank of America doesn\u2019t recommend getting lured in by Target\u2019s cheap valuation. \u201cTarget is falling behind peers and has tougher challenges,\u201d wrote Robert Ohmes, a senior research analyst at the bank, in an Aug 15. note downgrading Target to underperform ahead of earnings. Mr. Ohmes said Target\u2019s compounding sales growth has fallen below Walmart, as Walmart\u2019s online sales \u201cmeaningfully outpace\u201d those of Target.<\/p>\n

Aside from comparing the two, investors will be eyeing what the earnings say about the consumer spending outlook: If nothing else, it may offer a more accurate picture than numbers from the Bureau of Labor Statistics, where former commissioner Erika McEntarfer was recently fired by U.S. President Donald Trump. <\/p>\n

Building blocks: Home Depot Inc. and Lowe\u2019s Companies Inc. have been on a tear with both retailers\u2019 stocks up about 20 per cent over the last few months. Earnings this week will be a test of whether the enthusiasm around housing is warranted. <\/p>\n

It is no secret that the U.S. housing market has been in a funk coming off the trading-spaces hype, post-pandemic. Hopes are high that things are starting to turn around. Estimates for comparable sales growth are sitting at a three-year high. Royal Bank of Canada is warning that might be too lofty, in a preview note to clients. \u201cWe\u2019re expecting modest comp misses for both names,\u201d wrote Steven Shemesh, equity research analyst at RBC Capital Markets. However, he acknowledges that the buy-side might be prepared for that. <\/p>\n

Cyberstalking: Palo Alto Networks Inc. will have a chance to calm some nerves when it reports Monday. The cybersecurity giant plunged after announcing a US$25-billion deal to buy Israel\u2019s CyberArk in a cash and stock deal at the end of July. <\/p>\n

Investors are also nervous about volatile tech spending and how that might affect their forecast. Earnings from rivals haven\u2019t been a clean sweep and that is putting investors on edge. \u201cDespite our expectations of a solid quarter, we think shares will likely trade sideways in the near-term, given a combination of a potentially conservative guide, along with long-only investors not rushing to jump into the name,\u201d wrote Adam Borg, managing director of equity research with Stifel, in a preview note to clients. <\/p>\n

In the Money with Amber Kanwar brings you insights from top portfolio managers and business leaders. Listen at www.inthemoneypod.com<\/a> <\/p>\n","protected":false},"excerpt":{"rendered":"This is the first time all summer that my husband and I have gotten away, just the two…\n","protected":false},"author":2,"featured_media":77535,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[901,888,902,879,877,903,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,44,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-77534","post","type-post","status-publish","format-standard","has-post-thumbnail","category-canada","tag-alberta","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-news","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/77534","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=77534"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/77534\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/77535"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=77534"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=77534"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=77534"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}