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The Week Ahead: Consumers, confidence and the coronavirus

Tom Hudson, Miami Herald on

Published in Business News

It has been more than a decade since Walmart stopped publicly reporting its monthly sales figures. At the time the world's largest retailer reasoned that doing away with the monthly updates "aligns investors with the long-term view we take to build shareholder value."

The decision also removed an almost real-time barometer of the consumer.

Instead, investors and others have had to wait for quarterly updates. The latest is scheduled for Tuesday in the week ahead.

Walmart's financial results are an important, albeit imperfect proxy for the American consumer. Consumer confidence in January hit a four-month high. Optimism about the job market helped boost consumer's spirits. The impeachment hearings, the Iowa Caucus and rising tensions between the U.S. and Iran didn't dampen the American consumer's attitude.

Walmart's quarterly results will give investors some clues about how that confidence is translating into spending. Shareholders understandably will be focused on the company's digital efforts to compete with Amazon. But Walmart's data also may provide investors with some insights into the continued health of the shopper.

After all, the consumer makes up about 70% of the U.S. economy and each week Walmart hosts almost 275 million customers worldwide according to the company's 2019 annual report.

The company has more than 400 stores in China. While a small percentage of all the Walmarts in the world, many of the products lining its shelves come from China. What the company is experiencing with Chinese shoppers dealing with quarantines and mass roundups will give the markets important insight into the economic threat posed by the virus. How the company is maneuvering with the Chinese product pipeline also will echo through the markets.

 

About The Writer

Financial journalist Tom Hudson hosts "The Sunshine Economy" on WLRN-FM in Miami, where he is the vice president of news. He is the former co-anchor and managing editor of "Nightly Business Report" on public television. Follow him on Twitter @HudsonsView.

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