Tourists crowd sidewalk tables at a bar in Praça do Comercio on April 1, 2022 in Lisbon, Portugal. A study by the University of Coimbra, which evaluated the impact of COVID-19 on Portuguese nationals summer holidays, concluded that the pandemic provided opportunities for the country.Horacio Villalobos/Corbis via Getty Images
Welcome back. There's a tide shift happening between Wall Street and Main Street. Investors are reacting, and corporate earnings are signaling a broader change across the economy.
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Let's break it down.
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Analysts say firms are moving cautiously, and have added to their loan loss reserves. Consumer-facing industries like Airlines on the other hand, are seeing renewed demand from consumers.
"We see signs of goods demand cooling, particularly in big ticket items, while services benefit from strong pent-up demand," Bank of America said Monday.
Meanwhile, Morgan Stanley says inflation is no longer a net positive for earnings growth. As consumers take on higher food and gas prices, cost pressures are starting to hurt margins.
Moving forward, historic inflation is more likely to be a headwind to growth, Morgan Stanley said, especially as the Fed turns increasingly hawkish. Signs are pointing to a more disappointing earnings season than anticipated, the bank concluded.
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In other news:
2. US futures are pointing lower with a stream of earnings ahead. Corporate reports aren't the only thing on traders' minds, after Fed official James Bullard touted potential 75 basis-point hikes. Here are the latest moves on the market.
3. Earnings on deck: Johnson & Johnson, Lockheed Martin, Netflix, and IBM, all reporting.
4. Bank of America recommends this list of stocks ahead of their next earnings, when they're likely to beat expectations once again. Strategist Jim Carey Hall told investors how to beat the market in the coming months, highlighting these 14 companies in particular.
6. The World Bank slashed its global growth forecast due to Russia's invasion of Ukraine. The institute also announced it would mobilize a relief package bigger than the one it delivered in response to the COVID-19 pandemic. Get the full details here.
8. A 30-year-old who has achieved financial independence through real estate investing spent a year reading every financial book he could get his hands on. "There's absolutely a direct correlation between learning and earning," said Ludomir Wanot. Here are his two favorite money books.
Keep up with the latest markets news throughout your day by checking out The Refresh from Insider, a dynamic audio news brief from the Insider newsroom. Listen here.
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