And the crowd goes wild

We’re still sweating in the summer sun, but Starbucks already declared fall is here (aka PSL szn). The pumpkin spice latte — which contributes up to 10% of Starbs’ total sales — is back earlier than ever.

Stocks rose last week, and the S&P 500 popped 1% on Friday, with real estate being the best-performing sector as investors reacted to Fed Chair Powell’s speech (more on that in a sec). 

👔 Quizness as usual: The Snacks Seven quiz is back to test how closely you’ve been paying attention to the biggest biz news. Try the first q:

DJ Powell’s set… On Friday all eyes were on the yearly Jackson Hole economic meetup (central bankers’ version of Coachella). The headliner: Jerome Powell. The Fed chair’s mic drop: “the time has come for policy to adjust.” It suggested the central bank is finally prepared to cut interest rates next month. Stocks popped after Powell’s comments, which were a big shift from last year’s meeting, when he said inflation was still too high. 

Fed up with high APRs… Investors are all but certain of a September trim, which would be the first since March 2020, when rates were emergency-slashed to nearly zero. While the US central bank has paused hikes, rates are still at their highest level in decades. That’s weighed on companies and consumers, but easing could change that:

Markets are forward-thinking… Now that the market’s fully pricing in a September cut, traders have moved on to the next thing: how big will the cuts be — and how many? After Jackson Hole, traders’ bets on a cut of 50 basis points rose to 37% (versus 64% for a 25 bps cut). Economists said the central bank could trim at each of its final three meetings this year. Consumers might be thinking ahead to the good times too: retail sales in July spiked 3x more than expected. 

AIs on the prize… Nvidia’s powering up to report earnings. In Q1, the chip titan said its sales more than 3x’d from a year earlier to a record $26B as AI demand sizzled. Nvidia has sold billions’ worth of H100 GPUs, but now all eyes are on its faster-processing Blackwell AI super chip, which is said to have garnered big orders from Google, Microsoft, and Meta. But Blackwell shipments are facing delays, and China’s Huawei is reportedly set to drop a rival AI chip. Still, Wall Street thinks Nvidia will unload chipper results on Wednesday. 

Pet-food subscription… auto-shipped monthly. Chewy reports Wednesday, and investors expect tail-wagging results. The online pet retailer’s profits nearly tripled in Q1 with auto shipments making up 78% of sales. Chewy said spending’ll cool as pandemic pets grow up and adoptions slow. But with retail spending staying buoyant, pawrents may keep buying Lamb Chop toys. JM Smucker, also reporting Wednesday, has seen its Meow Mix and Milk-Bones boost earnings so much that it launched a Milk-Bone dog treat with Jif peanut butter.

Banned bans… A federal judge last week blocked the FTC’s ban on noncompete agreements, ruling that the agency didn’t have the proper authority. About 20% of US workers are under a noncompete, which prevents them from working for a competitor or starting a rival biz for a stretch of time. The FTC said its federal ban could’ve lifted employee earnings by $400B+ over the next decade. Despite the ruling, four states have already passed blanket bans, and 33 more have restricted them for certain income levels and industries. The FTC’s considering an appeal.

$10 box of cereal… VP Kamala Harris called for a ban on price-gouging by food companies and grocery stores. Since the pandemic, food prices have soared over 20%, but a group repping food retailers said politicians are confusing price-gouging with plain ol’ inflation. A combo of factors is likely to blame, but grocery stores have reason to think Harris’ call out of “opportunistic companies” means them. The FTC is taking Kroger and Albertsons to court this week to challenge the duo’s proposed merger, which regulators say could lead to even higher grocery bills.

Travel companies are talking about a slowdown, but it hasn’t shown up in the wider data… yet. Read more.

Fewer than 70% of 19-year-olds in the US had a driver’s license in 2022, down from 87% in 1983

Authors of this Snacks own shares of: Alphabet, Amazon, Microsoft, Nvidia, and Ulta

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