Wall Street’s eyes have been opened with Black Friday sales in focus

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Wall Street’s major indexes were set for a moderate open on Friday, with investors watching major retailers closely as Black Friday sales kicked off amid stubbornly high inflation and worries about a possible recession. next year.

US retail stocks, a barometer of consumer confidence as inflation bites, remain under pressure after a lull in October and November.

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Retailers have been forced to offer deep discounts to entice buyers, threatening their profit margins. In fact, retailers across Europe fear the Christmas shopping season could be the worst in at least a decade.

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Target Corp, Macy’s Inc and Best Buy Co Inc warned of deeper discounts in November and December than in the previous two years. Their shares were mixed in light trades before market.

The focus will also be on consumer discretionary stocks, a group whose members range from Amazon.com Inc to automaker Tesla Inc and retailer Target, to better understand how much consumers are opening up their wallets.

According to the National Retail Federation, about 166.3 million people plan to shop from Thanksgiving Day to Cyber ​​Monday this year.

“It’s a very competitive retail environment, both the price reduction and the best position for inventory will play a big part in how you do over the course of the season,” Rick said. Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.

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“Margins will be squeezed and earnings will be lower…the biggest question will be the company’s outlook for next year and whether investors think this is a reciprocal bottom or the start of a new trend and reduced spending.”

Wall Street’s major indexes have rallied strongly since hitting early October lows, with the S&P 500 up more than 12% on the back of a better-than-expected earnings season rally and more recently the hope for less aggressive interest rate hikes by the US federal government. Reserve.

The Fed is now expected to raise its key interest rate by 50 basis points in December with a 63.5% chance, with rates peaking in June 2023.

As of 8:30 a.m. ET, Dow e-minis were up 38 points, or 0.11%, S&P 500 e-minis were up 1 point, or 0.02%, and Nasdaq 100 e-minis were down 28.5 points, or 0.24%.

Activision Blizzard fell 3.2% following a media report that the U.S. Federal Trade Commission is likely to file an antitrust complaint to block Microsoft Corp’s $69 billion takeover bid for video game publisher.

Apple Inc fell 1.1% after announcing reduced iPhone shipments in November to a Foxconn factory in China.

U.S. stock markets will remain open for half a session Friday until 1 p.m. ET, after being closed Thursday for Thanksgiving. (Reporting by Ankika Biswas and Shubham Batra in Bengaluru; Editing by Shounak Dasgupta)


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