Bitcoin Rally Stalls Out — Market Talk
1217 ET - Bitcoin is down 1.6% to $77,095, dropping after posting a strong rally over the past three weeks. The cryptocurrency seems unable to stay above the $80K mark, which is now the major psychological threshold it needs to break in order to keep the rally going. The $80K mark is where a spring rally in bitcoin topped off at in early May. "Bulls want to see Bitcoin clear this zone, which could open the door to further upside," says Bret Kenwell of eToro in a note. Ethereum is down 1.3% to $2,440, XRP is down 3.5% to $1.35, and solana slides 3% to $99.49. ([email protected])1201 ET - Groupe Dynamite's real estate strategy of having a presence in the best locations is paying off, says Chief Executive Andrew Lutfy on an earnings call. The executive says that the stores that he categorizes as 'tier 1 though tier 3' represents about 72% of the company's sales, noting that in 2017, it was roughly 28%. Lutfy says that the better-located stores move inventory at a faster clip than lower tier locations. Through this quality real estate strategy, he says "we aren't simply improving the quality of our stores, we are improving the productivity of the entire business." He expects that this will create a higher quality network which raises the performance standards across the broader portfolio. "It's a positive flywheel effect," Lutfy adds. ([email protected])1149 ET - Canadian grocer Empire faces market share headwinds due to a smaller discount footprint relative to peers in an inflation-weary environment. In an earnings call, CEO Pierre St-Laurent says that the company has maintained its discount market position, but it is aggressively accelerating its format expansion to capture budget-conscious shoppers in the face of "the rapid expansion of discount formats across the market." He notes that in August, Empire opened its first FreshCo discount banner store in Atlantic Canada, alongside new locations in Calgary and Paris, Ontario. The company is also now planning to open 25 new stores in the year instead of 20. St-Laurent says: "as we continue to expand discount footprint, we expect that growth to increasingly support market share gains." ([email protected])1044 ET - Macy's says its shoppers have remained resilient, primarily in higher income cohorts. "Across nameplates, we continue to skew toward middle- and upper-income consumers, where performance remained stronger," Chief Executive Tony Spring says on a call with analysts. Lower-income consumers are more discerning about what they buy, which is in line with previous trends Macy's has reported, Spring says. The wealthier shoppers are responding to Macy's new assortment of products, which includes higher quality materials and more expensive brands, he says.([email protected])1030 ET - Macy's is staying relatively conservative with its outlook for same-store sales. The retailer raised guidance for same-store sales to grow 1% to 1.5%, up from its previous outlook of 0.5% to 1.2% growth. This guidance comes after Macy's had roughly 3% growth in the first two quarters of the year. The same-store sales metric was higher in the second half of last year, so the company will have to grow from a higher baseline in the next two quarters, executives tell analysts on a call. Staying prudent with the guidance will also give the company more room to deal with macroeconomic and geopolitical uncertainty, management says.([email protected])1023 ET - Macy's has seen a slowdown in the share of shoppers who complete a purchase in their stores, as the company is putting pricier items on its shelf. Executives say on a call with analysts that conversion was lower in the second quarter, despite higher average unit revenue and greater traffic in stores. Macy's data shows that shoppers sometimes visit two or three times before buying an item because they deliberate more over buying a pricier item, the executives say. Macy's average selling prices have increased, as the company is bringing in higher-end products and previously raised prices following tariffs. ([email protected])1015 ET - Homebuying costs have hit their highest level in over a year, Redfin says. The typical U.S. homebuyer's monthly mortgage payment reached a 14-month high of $2,641. That's partly because the median home-sale price rose 2.2% year over year, and partly because the weekly average mortgage rate increased to 6.71%. Elevated costs are keeping some would-be buyers on the sidelines. Pending home sales were essentially flat from a week earlier, sitting near their lowest level since February. Buyers have negotiating power in most of the country, but for many house hunters, that isn't enough to offset high costs. Sellers are listing their homes because they want to sell before prices decline, life circumstances are prompting them to move, and the lock-in effect is easing. ([email protected])1006 ET - Groupe Dynamite delivered a strong "beat-and-raise" performance in 2Q, topping forecasts across revenue, margins and earnings. TD Cowen's Brian Morrison notes that revenue rose 30%, 5% ahead of TD's forecasts, driven by same-store sales growth of 10.3%, better-than-expected contributions from new stores and continued ecommerce momentum. Profitability also drove the outperformance, with adjusted Ebitda margin expanding 740 basis points to 44.3%. That margin expansion was fueled by a 525-basis-point gross margin gain as the company lapped elevated tariffs and realized operational efficiencies at its U.S. distribution center. "We expect investor focus to remain on the cadence of SSSG through H2/F26, though current trends appear supportive of management's full-year outlook," Morrison says. Shares are up 9.9% to C$62.39. ([email protected])0958 ET - Oil futures are sharply higher with WTI hitting $100 a barrel for the first time since May amid increased military strikes between the U.S. and Iran and Houthi advances toward the Bab el-Mandeb strait. "The move is raising fresh concerns about the security of global energy supplies," Fawad Razaqzada of Forex.com says in a note. "A sustained move above $100 in WTI would put renewed upward pressure on inflation expectations." WTI is up 4.1% at $99.95 a barrel and Brent is 3.8% higher at $105.10 a barrel. ([email protected])0926 ET - August's PPI largely met analyst expectations, rising 0.4% from July. Now, market participants will focus on tomorrow's CPI print. Rate hike projections are nearing 70% for September's interest rate meeting, according to CME's FedWatch tool. After the CPI is released, economists will start submitting their projections for PCE, the Fed's preferred inflation target. A lower-than-expected CPI print tomorrow would strengthen the case for holding rates steady. "October is a live meeting, but it would be highly unlikely that they would begin a rate hiking cycle," wrote Chris Zaccarelli, chief investment officer for Northlight Asset Management.([email protected])0921 ET - Nothing in today's economic data could dissuade selling pressure seen in the Treasury market, BMO Capital Markets' Ian Lyngen says in a note. The August PPI moves higher, and the yearly pace moves higher month-over-month for the first time since May, Lyngen says. That should clear the way for the CPI to set the agenda on inflation tomorrow, he says. Weekly jobless claims meanwhile come in at 206,000, a decrease of 1,000 from the previous week's revised level. Given those readouts, the bearish repricing in Treasurys has room to extend, Lyngen says. ([email protected])0914 ET - Shares in London mining stocks are down in afternoon trade as Brent crude tops $105 a barrel and hostilities between the U.S. and Iran escalate. Higher oil prices will add costs to energy intensive miners who are some of the worlds largest consumers of diesel. Higher oil prices also raise the prospect of interest rate rises to combat inflation. This would hurt investment and consumer sentiment, and drag on demand for mined minerals and metals. Anglo American falls 5.4% while BHP's London shares are down 4.7%. Rio Tinto's slip 3.25%. Glencore slides 3.4% while copper miner Antofagasta falls 6%. ([email protected])