Consumer Sentiment - The University of Michigan consumer sentiment survey indicates a decline in consumer expectations, with the index at 49, below the contractionary threshold of 50 [2][4] - Current conditions index is reported at 52.3, significantly lower than the expected 59.2, reflecting a deteriorating sentiment [3][4] - One-year inflation expectations have increased slightly to 4.7% from 4.6%, suggesting growing concerns about rising prices among consumers [3][4] Market Impact - The decline in consumer sentiment is contributing to market pressure, particularly in the technology and communication services sectors [5] - Despite the overall pessimism, individuals with substantial stock portfolios are feeling somewhat more optimistic, possibly influenced by the timing of the survey release before the upcoming election [5] Commodity Market - Mixed signals are observed in the commodity market, with oil prices showing a slight increase while industrial metals are experiencing a pullback due to concerns over China's export contraction [8][9] - The U.S. government has added critical minerals like uranium, silver, and copper to its list, which may positively impact U.S.-based mining companies [11][12] Geopolitical Factors - Hungary's Prime Minister Victor Orban is set to meet with former President Trump, with discussions likely to include energy deals, particularly regarding Russian oil and natural gas [14][15] - The geopolitical dynamics surrounding Hungary's energy imports could introduce risks to the market, especially in the context of the Russia-Ukraine conflict [16] Technical Analysis - The S&P 500 is testing its 50-day moving average, a critical support level that has not been broken since before the tariff tensions [18][21] - Increased put activity suggests a cautious market outlook, but a potential rebound could occur if support levels hold [20][21] Legislative Developments - Senator Thun is expected to vote on a package to reopen the government, which may influence market sentiment positively if concessions are made [22][23] - Airlines like United Airlines are seeing stock price recoveries, indicating potential market uplift from favorable news regarding government negotiations [23]

Greg Frankfort is the lead restaurant analyst over at Guggenheim Securities. He's with us now for more color on that conversation. Greg, Kate's report talked a little bit and focused more so on that kind of lower income consumer feeling the pain.Is that going to reverberate through not just McDonald's but other parts of fast food as well. Yeah, it's it's it's clearly been the issue and I I think Chipotle's probably laid it out the clearest that that kind of sub45,000 uh uh 45,000 household income customer h ...

Summary of China Consumer Pulse Q3 2025 Industry Overview - **Industry**: Chinese Consumer Market - **Key Sectors Analyzed**: Alcohol, Apparel, Beauty, Travel, Luxury Goods, Autos Core Insights 1. **Mixed Consumer Sentiment**: Chinese consumer sentiment remains mixed, with a notable divergence in spending patterns across sectors [2][29][30] 2. **Experiential Spending Resilience**: Experiential categories such as restaurants (+24% YoY) and travel (+16% YoY) show resilience, indicating a shift towards experiences over goods [2][35] 3. **Premium Demand Recovery**: Onshore luxury spending has improved, with premium auto sales stabilizing and showing positive year-over-year growth in September, ending a 19-month decline [2][30] 4. **Digital Channels Outperform**: Digital retail channels continue to outperform traditional retail, although there are signs of weakness in specific segments like beauty e-commerce, which saw a -3% decline [2][29][30] 5. **GDP and Retail Growth Slowdown**: China's Q3 GDP growth slowed to 4.8% YoY, with retail growth easing to 2.1%, attributed to fading consumer incentives and macroeconomic uncertainties [3][29] 6. **Deflationary Trends**: Deflationary pressures persist across travel and hotel pricing, with moderate price declines observed [12][29] Sector-Specific Insights Premium Beverages - **Weak Demand**: Ultra-premium Baijiu prices continued to slide in Q3 due to weak demand, particularly around the Mid-Autumn Festival [4][30] Apparel and Sportswear - **Mixed Performance**: The apparel market is growing online but remains negative offline, with brands like Adidas showing over 20% growth while Nike faces challenges [5][22] Home Appliances - **Sector Contraction**: The home appliance sector contracted by 7% in Q3, with significant declines in both domestic and overseas exports [7][31] Luxury Goods - **Signs of Improvement**: Early signs of recovery in the luxury market, with brands like Hermès and Louis Vuitton performing well, while Kering struggles [8][9][30] Automotive - **Sales Growth Slowdown**: Auto sales growth slowed to +2.5% YoY in Q3, with EV sales decelerating to +12.5% YoY. However, EV penetration reached 55.1% [10][16][17] Hotels - **RevPAR Declines**: Domestic hotel RevPAR continues to decline, with luxury hotels being the only segment not experiencing persistent declines [10][23] Travel - **Resilient Growth**: The travel industry showed stable positive growth of 16% during the National Day Golden Week, reflecting ongoing domestic travel trends [11][12] Cosmetics - **Moderate Growth**: The cosmetics sector saw a +6.5% YoY increase in gross merchandise value, marking an improvement from previous quarters [13][29] Additional Considerations - **Cautious Consumer Behavior**: The macroeconomic environment is expected to lead to cautious, value-driven consumer behavior, highlighting the uneven recovery across sectors [3][32] - **Investment Implications**: The outlook for various sectors remains cautious, with potential growth in EVs and premium segments, while traditional sectors face challenges [16][17][22][23]

Financial Data and Key Metrics Changes - D.R. Horton reported consolidated pre-tax income of $1.2 billion on revenues of $9.7 billion for Q4 2025, with a pre-tax profit margin of 12.4% [7] - For the full year, consolidated pre-tax income was $4.7 billion, with a pre-tax profit margin of 13.8% [7] - Net income for Q4 was $905.3 million, or $3.04 per diluted share, on consolidated revenues of $9.7 billion [9] - The average closing sales price for Q4 was $365,600, down 1% sequentially and down 3% year-over-year [9] - The company generated $3.4 billion of cash from operations in fiscal 2025, representing 10% of total revenues [19] Business Line Data and Key Metrics Changes - Home sales revenues for Q4 were $8.5 billion on 23,368 homes closed [9] - Net sales orders in Q4 increased 5% year-over-year to 20,078 homes, with order value increasing 3% to $7.3 billion [10] - The gross profit margin on home sales revenues in Q4 was 20%, down 180 basis points sequentially [11] - Rental operations generated $81 million of pre-tax income on $805 million of revenues in Q4 [16] Market Data and Key Metrics Changes - The average number of active selling communities was up 1% sequentially and up 13% from the prior year [10] - The company’s home building lot position at year-end consisted of approximately 592,000 lots, with 25% owned and 75% controlled through purchase contracts [15] - Lot costs increased by 8% year-over-year on a per square foot basis [60] Company Strategy and Development Direction - D.R. Horton remains focused on capital efficiency to generate strong operating cash flows and deliver compelling returns to shareholders [8] - The company plans to tailor product offerings and sales incentives based on demand in each market to maximize returns [8] - The strategic relationship with Forestar is vital for the company’s returns-focused business model, with Forestar reporting revenues of $671 million in Q4 [17] Management's Comments on Operating Environment and Future Outlook - Management anticipates that new home demand will continue to be impacted by affordability constraints and cautious consumer sentiment [21] - For fiscal 2026, the company expects consolidated revenues of approximately $33.5 billion to $35 billion and homes closed to be in the range of 86,000 to 88,000 [21] - Management expressed a positive outlook for the housing market over the medium to long term, despite current volatility and uncertainty in the economy [23] Other Important Information - The company repurchased 4.6 million shares for $689 million in Q4 and 30.7 million shares for $4.3 billion for the full year [19] - D.R. Horton’s fiscal year-end stockholders' equity was $24.2 billion, down 4% from a year ago, but book value per share was up 5% to $82.15 [20] Q&A Session Summary Question: How to think about the transition from 20% gross margin in Q4 to 20%-20.5% in Q1? - Management indicated that the unusual impact from litigation costs is not expected to persist into Q1, and the baseline would reflect a more normal impact from warranty and litigation going forward [27] Question: Can you discuss the starts pace and how quickly it can ramp up? - Management acknowledged that starts were intentionally lower to align inventory and indicated confidence in ramping up starts to meet demand as needed [28] Question: What is the outlook for rental operations in Q1? - Management expects rental operations to be a bit softer in Q1, with a heavier delivery expected in the back half of the year [32] Question: Can you provide insight into the Southeast market performance? - Management noted that while some areas in Florida are struggling with inventory balance, overall demand in the Southeast remains choppy [74] Question: What are the expectations for lot costs moving forward? - Management indicated that lot costs are expected to remain sticky, with an 8% year-over-year increase noted [60]

Core Insights - Consumer confidence has reached its lowest level since April, indicating a significant decline in economic sentiment [1] - The drop in consumer confidence is attributed to slumping income expectations, which are influenced by ongoing geopolitical uncertainty and rising inflation [1] Summary by Categories Consumer Confidence - Consumer confidence has decreased to its lowest point since April [1] - This decline reflects a broader concern among consumers regarding economic stability [1] Income Expectations - There has been a notable slump in income expectations among consumers [1] - The decrease in income expectations is a critical factor contributing to the overall decline in consumer confidence [1] Geopolitical and Economic Factors - Continued geopolitical uncertainty is impacting consumer sentiment negatively [1] - Higher inflation rates are also contributing to the decline in consumer confidence and income expectations [1]

Economic Data Overview - The Consumer Price Index (CPI) rose to 3.0% in September, slightly up from 2.9% in August but below the expected 3.1% [2] - Monthly price growth was 0.3%, a deceleration from the 0.4% increase in August and below the projected 0.4% [2] - Core inflation, excluding food and energy, cooled to 3.0% in September, down from 3.1% in August and below the expected 3.1% [2] Inflation Drivers - The primary contributor to the CPI increase in September was higher gas prices, while food, shelter, airline fares, recreation, household furnishings, and apparel also saw price increases [3] - Conversely, prices for motor vehicle insurance, used cars, and communication costs declined [3] Consumer Sentiment - The University of Michigan Consumer Sentiment Index fell nearly 3% to 53.6 in October, below the forecast of 55.0, marking the lowest level since May [5] - The decline in sentiment was attributed to ongoing inflation concerns, with younger consumers showing improved sentiment but older demographics experiencing noticeable drops [6] Housing Market Insights - Existing home sales rose 1.5% in September, reaching a seasonally adjusted annual rate of 4.06 million units, aligning with expectations [8] - The median price for existing homes decreased by 1.7% from August, marking the lowest level in five months, although it was up 2.1% year-over-year [9] Market Reactions - The S&P 500 index briefly crossed above 6,800 for the first time, finishing the week with a 1.9% gain [11] - The CME FedWatch Tool indicates a 97% likelihood of a 25 basis point rate cut by the Federal Reserve in the upcoming meeting [12] Upcoming Economic Outlook - The economic outlook remains complex due to the ongoing government shutdown, with private and regional reports expected to provide insights into economic activity [13] - Attention will be focused on the Federal Reserve meeting, which will influence market expectations, alongside housing market reports and manufacturing sector data [14]

Economic Indicators - The September US CPI report showed a monthly increase of +0.3% and a yearly increase of +3.0%, which was slightly below market expectations of +0.4% m/m and +3.1% y/y [2] - The core CPI for September also rose by +0.2% m/m and +3.0% y/y, again slightly weaker than the expected +0.3% m/m and +3.1% y/y [2] - The final-August University of Michigan US consumer sentiment index fell by -1.4 points to 53.6, weaker than the expected drop to 54.5 [3] Market Reactions - The dollar index ended the day little changed, influenced by the weaker-than-expected CPI report and a -0.6 basis point decline in the US 10-year T-note yield [1] - The markets are pricing in a 97% chance of a -25 basis point rate cut at the next FOMC meeting on October 28-29 due to the ongoing US government shutdown [4] Eurozone Indicators - The preliminary-October HCOB Eurozone manufacturing PMI rose by +0.2 points to 50.0, exceeding expectations for no change at 49.8 [5] - The preliminary-October HCOB Eurozone services PMI increased by +1.3 points to 52.6, stronger than the anticipated decline to 51.2 [5]

Core Insights - Americans' views on the U.S. economy have deteriorated to their lowest level in months, primarily due to rising prices and inflation concerns [1][5] Consumer Sentiment - Consumer sentiment decreased from a preliminary reading of 55.1 to 53.6 in October, marking the lowest reading since May and falling below Wall Street's expectations [2][3] - The sentiment regarding current economic conditions dropped from 60.4 in September to 58.6 in October, the lowest since August 2022 [3] Inflation Expectations - Americans expect prices to increase by 3.9% over the next five to ten years, up from a 3.7% forecast in September, and anticipate a 4.6% rise over the next year, slightly down from 4.7% [3] Price Increases - The Bureau of Labor Statistics reported a 3% increase in prices from September, with gas prices rising by 4.1%, the largest monthly increase among tracked items [4] Economic Optimism - The decline in economic optimism is attributed to consumer frustration with persistent high prices, with about half of respondents indicating their personal finances have worsened [5] - There is a perception of few material changes in economic circumstances from September to October, with inflation remaining a primary concern [5] Labor Market Concerns - Economic confidence has declined, with only 27% of consumers stating that jobs are "plentiful," the lowest since February 2021 [7] - The labor market appears to have worsened, with estimates suggesting only 17,000 jobs were added in September, and a reported decrease of 32,000 in private-sector payrolls [8] Federal Reserve Outlook - The Federal Reserve is expected to lower interest rates by a quarter-point to between 3.75% and 4% in its upcoming meeting on October 29 [6]

We have some breaking economic data I see rolling across my ticker right now, University of Michigan, the final reading for October. Consumer sentiment falls to 53.6%. The estimate was for 54.5%.We have we have Michael McKee here with us on set, Bloomberg's international policy and economics Correspondent. So is this a case where above 50 is expansion and below 50 is contraction below. We're getting close to the line at this point with the headline number.The current conditions index falls to 56 from 61 and ...

Economic Data Summary - The University of Michigan's final reading for October shows consumer sentiment falling to 53.6%, below the estimated 54.5% [1] - The current conditions index decreased to 56 from 61, and expectations dropped to 50.3% from 51.2%, indicating a potential slowdown ahead [2] - The one-year inflation index remains unchanged at 3.6%, while the 5 to 10-year inflation expectation increased to 3.9% from 3.7%, raising concerns about long-term inflation [3] - The Consumer Price Index (CPI) reported an annual rate of 3% for both headline and core, which is significantly above the Federal Reserve's target of 2% [3] - There is uncertainty regarding the October CPI report, as the White House indicated it may not be released due to timing issues, leaving the Federal Reserve without crucial data for its December decision [4][5]