Espresso machine delivery ETA… 124 days. Three (related) themes are defining earnings season for companies, from airlines to pizza chains. First, supply-chain snarls are curbing sales of retailers like Nike, which had to close some factories despite booming demand. Second, rising materials costs have led companies like Clorox to lower yearly profit forecasts. Third, labor shortages are compounding both those problems, with companies like FedEx blaming worker shortages for lower-than-expected sales. Expect these issues to continue into the holidays.
Catered bagels for the branch… Big banks reported tasty quarterly profits. Profits at consumer-focused Bank of America, Wells Fargo, and Citi boomed after the banks released billions in loan loss reserves set aside for defaults that never happened. A jump in credit-card spending helped Citi’s profits soar 48% from last year, while IPO and merger-palooza boosted profits at investment banking giants JPMorgan Chase and Morgan Stanley. Trading activity is expected to slow, so we’ll see if investment banks can keep profits pumping.