👉 Wrapping Up Summer in the Markets...

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Welcome to your new week.

Retail sales just posted their steepest drop in over a year, and this week the two biggest retailers in America report earnings on either side of the Fed minutes. Lots of action as we wrap the summer up!

Key Earnings Announcements:

Retail takes over the calendar with roughly 200 companies set to report this week.

Monday (8/17): BHP Group, Build-A-Bear Workshop, DocGo, Fabrinet, Flexsteel Industries, H World Group, Medtronic, XP Inc.

Tuesday (8/18): Agilent Technologies, Amer Sports, Baidu, H&R Block, Home Depot, iQIYI, Jack Henry & Associates, Keysight Technologies, Klarna Group, La-Z-Boy, Mercury Systems, Pony AI, Toll Brothers, ZTO Express

Wednesday (8/19): Amcor, Analog Devices, BILL Holdings, Coty, Estée Lauder, Lowe's, Nordson, Progressive, Raymond James Financial, Target, TJX Companies, Viking Holdings, Webull, Zim Integrated Shipping

Thursday (8/20): Advance Auto Parts, Affirm Holdings, Alibaba, Deere & Company, Flowers Foods, Grab Holdings, Marvell Technology, NetEase, Peloton Interactive, Ross Stores, Walmart, Workday

Friday (8/21): BJ's Wholesale Club, Buckle, Ubiquiti

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What We’re Watching:

1. Home Depot (HD)

Home Depot (-1.5% YTD) reports Q2 2026 earnings Tuesday before the open, and the question is whether the housing consumer is still frozen or finally thawing. Shares closed Friday at $338.86 for a $337.9 billion market cap, leaving the stock 21.4% below the $431.37 record close it set in December 2024. Options are pricing a 4.2% move against a 3.8% average on recent reports, and the stock fell 3.6% after the last print.

Last quarter, Home Depot delivered net sales of $41.8 billion, up 4.8% year over year, but comparable sales rose just 0.6% and U.S. comps only 0.4%. Gross margin was 33.0%, operating margin 11.9%, and adjusted EPS came in at $3.43 against GAAP EPS of $3.30. Management reaffirmed the full year at 2.5% to 4.5% sales growth, flat to 2% comps, and adjusted EPS growth of flat to 4% off a $14.69 base.

This quarter, the focus is on the gap between sales and comps. The GMS acquisition is inflating the top line while the underlying store business barely grows, which means the headline revenue number will look better than the demand actually is. Watch the Pro versus DIY split, whether big-ticket discretionary projects are coming back at all with mortgage rates near 6.65%, and how much tariff cost is landing in gross margin. Housing affordability is the whole story here, and Tuesday's housing starts print arrives 30 minutes before the call.

• Analysts expect $4.61 GAAP EPS on Revenue of $47.2 billion.

• You can explore the most recent HD investor release here and here.

2. Walmart (WMT)

Walmart (+3.5% YTD) reports Q2 2027 earnings Thursday before the open, and it is the single most important read on the American consumer this month. Shares closed Friday at $115.27 for a $917.3 billion market cap, 14.1% below the $134.20 record close from May. Options are pricing a 4.6% move against a 5.3% average, and Walmart dropped 8.0% after its last report — the exact same setup as a year ago, when the Street sat at the top of guidance and the print disappointed.

Last quarter, Walmart delivered revenue of $177.75 billion, up 7.3% and 5.9% in constant currency, with adjusted EPS of $0.66 and GAAP EPS of $0.67. Walmart U.S. comparable sales rose 4.1%, global eCommerce grew 26%, advertising jumped 37%, and membership income climbed 17.4%. Operating income rose only 5.0%, held back by a $175 million fuel headwind.

This quarter, consensus sits at $0.74 adjusted EPS against management's own guidance range of $0.72 to $0.74 — the Street is at the very top of the guide, which is how you get an 8% drawdown on an in-line quarter. Watch the high-margin flywheel: advertising, membership, and marketplace now drive most of the profit growth while merchandise margins stay thin. This is also John Furner's second full quarter as CEO after taking over in February, and the first real test of whether he raises the full-year outlook or plays it safe with a soft consumer and tariffs still moving.

• Analysts expect $0.74 GAAP EPS on Revenue of $186.9 billion.

• You can explore the most recent WMT investor release here and here.

Investor Events / Global Affairs:

The largest apartment merger in U.S. history closes Monday, Google faces a court-ordered deadline to open Android to rival app stores, and 50% tariffs on Canadian goods take effect Wednesday.

• AvalonBay And Equity Residential Close To Form Vivmark

The merger of AvalonBay Communities (AVB) and Equity Residential (EQR) closes Monday, creating Vivmark Residential, which begins trading Tuesday under the ticker VMRK. Equity Residential shareholders receive 2.793 shares for each AvalonBay share, and both shareholder bases approved the deal with more than 99% of votes cast.

The combined company owns more than 180,000 apartment homes with over 10,000 units under construction, carrying roughly $53 billion in pro forma equity market capitalization and about $71 billion in enterprise value. That makes Vivmark the largest publicly traded apartment owner in the country by a wide margin, with concentrated positions in coastal gateway markets plus expansion markets in the Sun Belt.

The read-through matters beyond the two tickers. Apartment REITs have spent two years absorbing a record multifamily supply wave while rent growth flattened, and consolidation at this scale is what happens when public-market valuations sit below replacement cost. Watch index inclusion mechanics Tuesday, whether the combined dividend policy holds, and how management frames the synergy target on the first call. If Vivmark trades well, expect more of these.

• Google Hits A Court Deadline To Open The Play Store

Google faces a Thursday deadline to fix how the Play Store handles rival app stores, after U.S. District Judge James Donato ordered changes at an August 13 hearing in the Northern District of California and gave the company one week to comply. Google must replace the "View" button with "Install" for third-party app stores, eliminate the "are you looking for" interstitial that redirects users back to Play, and fix search results that bury competing storefronts.

The order enforces the permanent injunction Donato issued in October 2024 in Epic Games v. Google, which the Ninth Circuit upheld in July 2025. Google only began carrying third-party stores inside Play on July 22, 2026, and Aptoide became the first rival storefront to actually appear there on August 10. Donato's position is that the implementation was designed to technically comply while functionally discouraging anyone from using it.

This is the friction point for the whole app-economy trade. Google's Play Store generates high-margin, high-retention revenue inside Alphabet's Services line, and every barrier that comes down is a step toward the outcome Epic has been chasing since 2020. Watch what Google actually ships by Thursday, whether Donato accepts it, and whether Apple's parallel App Store obligations start moving in the same direction. Alphabet closed Friday at $345.90.

• U.S. 50% Tariffs On Canada Take Effect Wednesday

At 12:01 a.m. ET Wednesday, the United States begins collecting an additional 50% duty on 554 tariff lines of Canadian goods under Section 338 of the Tariff Act of 1930 — the first time that provision has ever been used. The measure covers roughly $20 billion to $28 billion of imports, about 5.2% of the $383 billion the U.S. bought from Canada in 2025, and unlike most existing tariffs it applies even to goods that would otherwise qualify for exemption under the USMCA.

The targeted list runs through alcohol, dairy, autos, cement, furniture, and hockey sticks. Canada-U.S. Trade Minister Dominic LeBlanc has met U.S. Trade Representative Jamieson Greer four times in three weeks, including twice last week, and Greer said Friday that Washington will proceed unless Canada drops its retaliatory measures. Quebec Economy Minister Bernard Drainville said after a Friday briefing that the two sides remain "quite far from an agreement."

The market question is not the $20 billion. It is precedent. Section 338 lets a president impose duties up to 50% by proclamation without an investigation, and using it against a treaty partner establishes that a signed trade agreement is not a ceiling. Canada's chief negotiator has warned that new tariffs on Wednesday would be a "cliff" that halts talks and forces retaliation. Watch autos, rail volumes, and the Canadian dollar, and watch whether a deal lands in the final 48 hours.

Major Economic Events:

FOMC minutes Wednesday and July housing starts Tuesday.

Monday (8/17): NAHB/Wells Fargo Housing Market Index, Empire State Manufacturing Index, Treasury international capital flows, 3-month and 6-month Treasury bill auctions

Tuesday (8/18): July housing starts, July building permits, Industrial production, Capacity utilization, Manufacturing production, Redbook retail sales, Pending home sales, 6-week bill auction, API crude oil stocks

Wednesday (8/19): MBA mortgage applications, FOMC minutes from the July 28-29 meeting, EIA petroleum inventories, 17-week bill auction, 20-year bond reopening

Thursday (8/20): Initial jobless claims, Continuing claims, Philadelphia Fed Manufacturing Index, Conference Board Leading Economic Index, Existing home sales, EIA natural gas storage, 4-week and 8-week bill auctions, 30-year TIPS auction

Friday (8/21): S&P Global flash manufacturing PMI, S&P Global flash services PMI, S&P Global flash composite PMI, Baker Hughes rig count

What We’re Watching:

1. FOMC Minutes

Wednesday at 2:00 p.m. ET the Fed releases the minutes from its July 28-29 meeting, and this set matters more than usual because of how the vote went. The committee held rates steady 9-3, with Cleveland's Beth Hammack, Minneapolis' Neel Kashkari, and Dallas' Lorie Logan all dissenting in favor of an immediate 25 basis point hike. Three dissents in the same direction had not happened since September 2016. Chair Kevin Warsh, in office since May, offered no forward guidance at the press conference.

Everything since has cut the other way. July payrolls fell 23,000 against a consensus of +80,000 with 103,000 in downward revisions, July CPI landed exactly in line at 3.4% headline and 2.5% core, retail sales dropped 0.6% in the steepest decline in over a year, and preliminary University of Michigan sentiment fell roughly 8% to 51. Odds of a September hike have fallen from about 67% on August 3 to roughly 40% now, with December replacing September as the most likely timing.

So the minutes are a snapshot of a hawkish debate that the data has since undermined. What to read for: how many participants beyond the three dissenters saw a hike as appropriate, what the committee said about labor market softening before payrolls went negative, and any discussion of the bar for moving in September. Bank of America and PGIM still expect hikes at all three remaining meetings. Barclays, Jefferies, Morgan Stanley, Truist, and UBS expect holds. The next meeting is September 15-16 and it comes with a dot plot.

Economists expect the following this week:

• Odds of a September rate hike: 40% now vs. 67% on August 3

• Fed funds target range: 3.50% to 3.75%, held for a fifth straight meeting

• July FOMC vote: 9-3, with three dissents in favor of a hike

2. Housing Starts And Building Permits

Tuesday at 8:30 a.m. ET the Census Bureau reports July housing starts and building permits, 30 minutes before Home Depot's earnings call. June was a head fake: total starts jumped 19.0% month over month to a 1,427,000 annual rate, but the entire gain came from multifamily, which surged to 513,000. Single-family starts fell to 895,000, down 0.2% on the month and 3.2% year over year.

Consensus calls for starts to fall back to 1,365,000 in July while permits tick up to 1,395,000 from 1,374,000. The forward-looking indicator is uglier. The NAHB/Wells Fargo builder confidence index fell 2 points to 34 in July and has now sat below 40 for 15 consecutive months, the longest such stretch since 2012. Thirty-seven percent of builders cut prices in July and 63% used some form of sales incentive. The August reading lands Monday at 10:00 a.m. ET.

This is the transmission channel that connects everything else in the week. Mortgage rates near 6.65% keep single-family construction suppressed, which shows up in Home Depot's Pro business Tuesday and Lowe's Wednesday, and it is exactly the kind of interest-rate-sensitive weakness that argues against the September hike the July minutes will show three governors wanted. If single-family starts break below 890,000, that becomes a much harder argument for the hawks to make.

Economists expect the following this week:

• Housing starts: 1,365,000 expected vs. 1,427,000 prior

• Building permits: 1,395,000 expected vs. 1,374,000 prior

• Industrial production: +0.2% MoM expected vs. +0.1% prior

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