Relative Performance - Small cap stocks are more sensitive to economic cycles and interest rate changes than large cap stocks [1] - Historically, small cap stocks have outperformed large caps by 2% to 3% annually, but have recently lagged due to high interest rates and economic uncertainty [1] Impact of Interest Rates - The Federal Reserve's high rate environment since 2022 has weighed heavily on small caps, which typically rely on borrowing to fuel growth [2] - Higher interest rates increase borrowing costs and compress valuations, hitting small cap profitability hard [2] - Rate cuts are bullish for small caps as these companies pay reduced interest expenses on debt [2] Economic Impact of Rate Cuts - Rate cuts tend to stimulate the domestic economy, which benefits small cap companies that rely on domestic demand [3] - Increased consumer spending and business investment, resulting from rate cuts, can disproportionately benefit small cap companies [3]

Applications for US unemployment benefits edged down last week, suggesting employers are holding onto current workers amid economic uncertainty. https://t.co/2tu9JQn65m ...

Core Insights - Allegiant (ALGT) is experiencing significant pressure from rising operating expenses and a complex economic environment, negatively impacting its investment attractiveness [1] Financial Performance - The Zacks Consensus Estimate for ALGT's current-quarter earnings has been revised downward by 84.68%, now projected at a loss of $2.05 per share [2] - The 2025 earnings estimate has also decreased by 30.86%, now standing at $2.42 per share [2] - ALGT's shares have declined by 36.6%, significantly underperforming the Transportation - Truck industry's decline of 4.6% [3][7] Operating Expenses - In Q2 2025, ALGT's consolidated operating expenses surged by 19.9% year over year, with airline-specific operating expenses increasing by 3.8% [4][7] - Key components of operating expenses include: - Aircraft lease rentals: up 91.7% - Maintenance and repairs: up 18.4% - Station operations: up 7.8% - Labor costs: up 2% [5][7] Market Position - ALGT currently holds a Zacks Rank of 5 (Strong Sell), indicating a lack of confidence from brokers [4] - The company is navigating a volatile macro environment characterized by economic uncertainty, shifting tariff regulations, and geopolitical tensions, which are forcing firms to delay investments and revise forecasts [5][8] Investment Alternatives - Investors in the Transportation sector may consider LATAM Airlines Group (LTM) and SkyWest (SKYW), both of which have a Zacks Rank of 1 (Strong Buy) [9][10] - LTM has an expected earnings growth rate of 45% for the current year, while SkyWest has an expected growth rate of 28.06% [10][11]

Home Depot has been hosting its earnings call this hour. Let's get to Courtney Reagan with some highlights. Morning, Courtney.>> Hi, Carl. Yeah, so despite missing the street's expectations for earnings and revenue for the first time since May of 2014, shares are higher on the reaffirmed guidance for the full year. Comparable sales also disappointed slightly, only the second positive comp in 11 quarters.though sales did continue to get stronger each month of the quarter and McFale just said the CFO on the c ...

What's so interesting, Islam research came out a week or so ago and look really buoyant about future growth and revenue. Very different for this CHIP equipment company. You are pointing out the debate that is waging and all the sell side reports in my inbox right now.Right. I mean, on the call last night, the narrative from the company was that China demand is worse in some of our largest customers that are holding off due to kind of just general economic uncertainty, tariffs and all that. But there's also ...

Tariffs and Trade Relations - The US imposed new tariffs, raising import taxes to the highest level since the Great Depression [1] - Japan claims the US overcharged tariffs and promised to refund overcharged companies [1] - Switzerland held an emergency meeting due to high tariff rates after unsuccessful negotiations with the US [1] - India and Brazil discussed boosting bilateral trade in response to the new US tariffs [1] - Some countries are deepening non-US trade relationships as a solution to over-reliance on the US market [1] - The EU and the UK are cutting deals aggressively in response to the tariffs [1] Economic Data and Presidential Approval - An economist at the Heritage Foundation found that the Bureau of Labor Statistics (BLS) overestimated job creation by 15 million (15%) jobs during the Biden administration [1] - The average median household income adjusted for inflation increased by $1,174 in the first five months of the current administration [1] - A CNBC survey indicates that 51% of respondents disapprove of the job the president is doing, while 45% approve of his handling of the economy [1] Federal Reserve and Economic Policy - The administration is considering Steven Miran for a position at the Federal Reserve, who advocates for a weaker dollar and stronger trade controls [3] Corporate Intervention - The president called for the CEO of Intel to resign over alleged ties to China, causing Intel's shares to fall by 3% [4][5] - The intervention in Intel's affairs is seen as disturbing and creating uncertainty for executives [10][11]

Tariff Impact on Consumers - Consumers are projected to experience an annual price increase of approximately $2,400 due to tariff rates rising from around 25% to as high as 41% for specific countries and imports [2][3] - The American middle class and moderate-income consumers are strained and lack the capacity to absorb an additional $1,000 to $2,000 in costs [10][11] - Companies are resorting to shrinkflation (reducing product quantity while maintaining price) and sneakflation (gradually increasing prices) to offset tariff costs [11][12] Uncertainty and Economic Distortion - The varying tariff rates and potential for further tariffs, including a possible 100% tariff on chips, create significant uncertainty [5] - Stockpiling of goods by companies to avoid tariff increases has distorted GDP data and is expected to continue doing so for the coming months [6] - The economy's reliance on the spending of the wealthiest Americans will determine whether a recession occurs [19][20] Investment and Capital Flows - The Trump administration is using capital flows as a bargaining chip in trade negotiations, demanding increased investment from the EU and Japan [13][14] - There is uncertainty regarding the terms of investment deals, with the EU and Japan clarifying that their commitments are loans, not permanent financial bailouts [14] - Companies are hesitant to make significant investments due to uncertainty, except for sectors like data centers for big tech [31] Economic Disparity - The bottom 80% of Americans have depleted their savings from the pandemic and stimulus payments [17] - A "reverse Robin Hood effect" is occurring, with tax cuts disproportionately benefiting the wealthy while cuts to programs like Medicaid and food stamps, coupled with higher prices, impact those at the bottom [22] Consumer Sentiment and Spending - Polls indicate that a majority of people disapprove of Trump's handling of the economy and inflation [27] - Uncertainty is causing consumers to consider saving more and reducing spending [28]

Market Analysis & Economic Outlook - The report addresses rising stagflation fears, but suggests smart investors see opportunity [1] - Pennington Partners & Co argues the US is not repeating the 1970s economic scenario due to improved policy approaches [1] - The report explores how the Federal Reserve's limited rate-cut flexibility, fiscal policy incentives, and corporate investment in artificial intelligence (AI) will shape markets [1] Investment Strategies & Company Protection - The report discusses how investors and companies can protect themselves amid economic uncertainty [1] - Stocks In Translation aims to provide information needed to make the right trade for your portfolio [1] Resources & Information - Yahoo Finance provides free stock ticker data, up-to-date news, portfolio management resources, comprehensive market data, and advanced tools [1] - Yahoo Finance can be found on various social media platforms including X (Twitter), Instagram, TikTok, Facebook, and LinkedIn [1]

Economic Concerns - Fed officials express concern over US economic uncertainty [1] - Rising unemployment in the US is a concern [1]

Well, earning season is showing us whether economic uncertainty is having an impact on companies and consumers. But do the results reflect what the recent macro data is signaling. Let's bring in JP Morgan asset management chief global strategist David Kelly and Bonson Group chief investment officer David Bonson.David's welcome. Uh David Bonson, Palanteer. We're going to get the results pretty darn soon.You argue it's run too far, but does this market need names like Palunteer to defy gravity if the market's ...