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From the point of view of the Federal Reserve, the economy is running smoothly. Now, the central bank’s goal is to keep it that way.In public remarks Monday, Federal Reserve Chair Jerome Powell framed the central bank’s decision to cut rates earlier this month as a move to keep a strong economy on sure footing rather than to rescue one that is faltering. Powell’s comments, delivered at a meeting of the National Association for Business Economics in Nashville, were his first on monetary policy since the Fed’s landmark decision to sharply cut its benchmark interest rate on Sept. 18.Financial market participants took Powell’s comments as throwing cold water on expectations for another sharp rate cut when the Fed’s policy committee next meets in November. Following Powell’s remarks, markets were pricing in a 36% chance the Federal Open Market Committee would cut its benchmark fed funds rate by 50 basis points at that meeting, as opposed to a smaller 25-point cut, according to the CME Group’s FedWatch Tool, which forecasts rate movements based on fed funds futures trading data. The previous business day, the tool put the odds of a larger cut at 53%.“This is not a committee that feels like it’s in a hurry to cut rates quickly,” Powell said. “It’s a committee that wants to be guided…by the incoming data.”

Since the Fed’s Sept. 18 meeting, economic data has reinforced the case that the U.S. economy is recovering smoothly from the burst of high inflation that took hold in 2021, prompting the Fed to rapidly raise its benchmark interest rate to discourage borrowing and spending. Inflation has cooled nearly to the Fed’s goal of a 2% annual rate, while the economy has stayed humming along—a scenario that economists call a “soft landing” as opposed to an economic crash.Powell pointed to a report on consumer spending released last week that included revisions to the previous year’s data. The revisions showed U.S. consumers have been making, spending and saving more money than previously thought. The data suggests that consumer spending—the main engine of the U.S. economy—is holding up well, he said.At the same time, the Fed is keeping a close eye on incoming economic data when planning its next interest rate moves. The central bank is trying to balance two priorities: keeping inflation under control and keeping unemployment from rising severely. Since 2022, the Fed has kept interest rates high, making all kinds of loans costlier, to cool the economy and quash inflation. With inflation having fallen significantly and employers having cut back on job openings, the Fed is now cutting interest rates.Powell said upcoming economic reports, including data on the labor market, would guide the committee’s decision making.“If the economy slows more than we expect, then we can cut faster,” he said. “If it slows less than we expect, we can cut slower. And that's really what's going to decide it.”

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Shares of package delivery giant FedEx (FDX) advanced to start the trading week amid predictions that demand for air freight could increase if dockworkers at ports on the U.S. East Coast and Gulf Coast begin a labor stoppage.

Following months of stalled negotiations over a new labor contract, members of the International Longshoremen’s Association are reportedly planning a walkout beginning Tuesday. The expected labor action by the 47,000-member union would disrupt activities at some of the country's biggest ports and cause rippling impacts throughout the economy.

According to reports, analysts at investment banking firm Stifel said companies with air freight capacity—including FedEx and logistics rival United Parcel Service (UPS)—are positioned to benefit from a potential dockworker strike as shippers turn to the skies to sidestep the affected port facilities.

FedEx shares rose 2.3% on Monday, marking one the S&P 500's top daily performances, while UPS shares advanced 1.6%.

The potential boost in the air freight business should come as welcome news to FedEx, whose shares plunged earlier this month when the company missed quarterly sales and profit estimates and slashed its full-year guidance.

Stifel analysts also mentioned a few other potential beneficiaries of the looming port strike, including freight forwarders like Expeditors International (EXPD) and C.H. Robinson (CHRW). Shares of both companies added 1.9% on the day.

Meanwhile, Baird focused on the possible consequences for other sectors. Baird analysts believe that any impact of the dock strike on shares of railroad operators is likely to be short-lived but cautioned of more extended impacts for companies like carmakers and retailers that depend on the ports to receive key parts and merchandise.

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Nike (NKE) will report fiscal first-quarter earnings after the bell Tuesday, and analysts are projecting sales and profits to decline year-over-year—but calling for little upside to the stock.

The consensus price target for the sports apparel company is $89.65, according to Visible Alpha, less than 2% above Monday's close.

Of the 20 firms surveyed with current ratings, nine have Nike as a "buy" rating, according to Visible Alpha. Another nine have it as a "hold," and two have posted a "sell" rating.

Net income is projected to fall by nearly half year-over-year to about $775 million, down from $1.45 billion a year ago. The company is expected to report higher expenses due to increased advertising during the Olympics, which took place during the quarter, and a focus on developing new products.

The case for the upside, according to Deutsche Bank analysts, is that this quarter should be the bottom for Nike's sales decline before a recovery, particularly as it transitions to a new CEO in October. Here’s what you need to know ahead of Nike’s earnings report.

Nike's shares are down roughly 20% this year.

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Millennials aren't counting as heavily on Social Security checks for income in retirement as some of the older generations.

Only 6% of millennial 401(k) participants—typically those born between 1981 and 1996—expect Social Security to be their primary income source in retirement, a recent Cerulli Associates report found.

Older workers, in contrast, plan to rely more heavily on Social Security in retirement. Roughly a third (30%) of Gen X 401(k) participants, typically those born between 1965 and 1980, said their main income source will be Social Security. Meanwhile, more than half (56%) of already-retired people depend mainly on Social Security for income, with personal retirement accounts as their primary savings for only 7% of that cohort.

For many Americans, Social Security is an essential source of income in retirement—although it was never meant to be people’s primary source of income. The program currently faces a significant funding shortfall that could hurt millions of retirees. A Congressional Budget Office projection found that starting in 2034, retirees would receive just 77% of their Social Security benefits unless Congress acted before then.

While financial advisors expect some sort of congressional solution to the Social Security shortfall, they say that younger generations are taking retirement saving into their own hands.

The majority of millennials (58%) anticipated that their personal retirement accounts would be their primary income source, compared with 39% of Gen X.

“When I talk to young people, I think they have a little negativity towards the government or public programs,” said Maryanne Gucciardi, a certified financial planner (CFP) at Wealthmind Financial Planning. “I think they rely more on their own ability to fund their retirement because they’re worried that Social Security won't be there for them.”

In the past, more workers could rely on pensions, too, which have fallen out of fashion in the past few decades. Only 5% of all respondents thought that their primary source of retirement income would be pensions, compared with 46% who thought it would be personal retirement accounts.

“Nowadays, most people don't have a pension—20 or 30 years ago many more people had pensions,” Monica Dwyer, a senior vice president and wealth advisor at Harvest Financial Advisors, said. “The onus is more on the individual to make sure they are saving enough for retirement.”

Now, when financial advisors like Dwyer meet with clients who are worried about Social Security, they create projections that account for the potential 23% cut in benefits.

In order to compensate for Social Security shortfall, experts recommend saving more for retirement by working longer, reducing spending, taking advantage of retirement accounts like 401(k)s and Roth IRAs, and waiting past full retirement age to collect Social Security.

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Not only does Costco Wholesale (COST) do a good job of getting its 76 million members in the door—but, according to a new report, manages to keep them there, too.

The average Costco visit lasted 37.3 minutes for U.S. customers in the first half of 2024, according to a Monday report from Emarketer citing data from Placer.ai. That’s more than Walmart (WMT) (31.8 minutes) and Target (TGT) (28.7 minutes), according to the report. 

Costco is also the only one of the three to see its average "dwell time" for customers staying in-store increase from the first half of 2021 to the same period this year. 

One likely reason for the extended stays is that Costco frequently changes its layout, creating a "treasure hunt" experience for customers. The membership-based retailer isn’t alone in changing things up, but it is notorious for rotating its stock of items.

In general, grocery stores are often known to stock essentials, like bread, milk, and eggs near the back of the store so customers have to walk all the way through to find them. 

Costco had 76 million members at the end of its most recent quarter, but starting Sept. 1 those members are paying more. After the retailer raised its membership price for the first time in seven years, executives said on an earnings call last week that they haven't seen any meaningful changes to renewal trends in the first month.

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A highly anticipated report on the job market Friday could show unemployment rising, potentially influencing how fast and how far the Federal Reserve will cut borrowing costs in the coming months.The Bureau of Labor Statistics’ report on jobs in September Friday is expected to show the unemployment rate holding steady at 4.2%, the same as in August, according to a survey of forecasters by and . The median forecast called for the economy to have added 144,000 jobs, up from 142,000 in August.Some forecasters called for the unemployment rate to tick up to 4.3%, matching its July level. That increase, if it comes, would likely be due to more people looking for work and not finding it rather than more people being laid off, Nancy Vanden Houten, lead U.S. economist at Oxford Economics, wrote in a commentary.

Reports on the labor force have taken on new significance in recent months as the formerly hot job market has lost some steam under pressure from the high borrowing costs for all kinds of loans over the past two years. 

While there are no signs of mass layoffs yet, employers have pulled back on job openings, and the unemployment rate has ticked up to typical pre-pandemic levels. Officials at the Federal Reserve began a campaign of rate cuts this month aimed at bolstering the economy and keeping the labor market healthy as their attention shifts from fighting inflation to preventing job losses. 

The fewer jobs the economy adds, and the higher the unemployment rate goes, the more pressure Fed officials will be under to cut rates faster, which would reduce borrowing costs for mortgages, auto loans, and credit cards. 

The Fed is widely expected to cut its benchmark fed funds rate again when it next meets in September. Financial markets are currently betting the central bank will slice either .5 or .25 percentage points from the current range of 4.75% to 5%. The Fed started its rate cuts with a .5 percentage point (or 50 basis points, also known as bp) reduction in September and could repeat that move depending on how the job market does in September and October. 

“We think a September jobs report in line with our forecast would be consistent with our view that after a 50bp rate cut earlier this month, the Federal Reserve can continue with rate cuts at a more measured pace, although we see the risks tilted toward a more aggressive pace of lowering rates,” Vanden Houten wrote in a commentary.Forecasters are also looking ahead to October’s jobs report, which could prove even more consequential, especially if highly publicized labor disputes at Boeing and at ports on the East and Gulf coasts result in strikes. 

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