🕟 On Deck

Good Afternoon. On this day in 1939, the Cincinnati Reds and Brooklyn Dodgers played the first televised Major League Baseball game.

Red Barber called it from Ebbets Field for roughly 400 television sets around New York, with only two cameras covering the action. The audience was tiny, but the experiment showed how a new technology could change an old business once the product proved useful.

Wall Street is waiting for a similar proof point from Nvidia after today’s close. Stocks and bonds edged lower as sticky inflation challenged the case for easier policy, while retailers, automakers, and cybersecurity firms supplied their own reminders that headline growth doesn’t tell the whole story. The next pitch is earnings, but margins, guidance, and consumer resilience will decide whether investors swing.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

🔢 Big number: $17.1 billion — That’s the maximum Meta could pay under its proposed settlement with 50 attorneys general, pairing a historic financial penalty with new limits on how minors use its platforms.

U.S. stocks drifted lower Wednesday as investors waited for Nvidia’s earnings after the closing bell. Around midday, the S&P 500 and technology-heavy market were both down slightly, while Treasury prices also slipped and volatility moved higher.

The news: Nvidia’s report matters because AI spending has become one of the market’s biggest profit assumptions, not just one company’s quarterly event. Investors want evidence that customers are still buying accelerators fast enough to support data-center budgets, supplier expansion, and premium valuations. At the same time, a stronger-than-expected inflation reading made a near-term Federal Reserve cut less comfortable, so traders didn’t have falling yields to cushion disappointment before the report.

What’s next: The first reaction will follow Nvidia’s numbers, but guidance and customer concentration will matter more than a single quarter. If demand stays durable without squeezing buyer returns, the AI trade can broaden; if management sees slower orders, today’s mild decline won’t look like much protection.

Source: Associated Press

The Federal Reserve’s preferred inflation gauge rose 3.7% from a year earlier in July, while the core measure reached 3.3%. Consumers kept spending, but the data didn’t give policymakers much reason to declare the inflation fight finished.

The news: Personal income increased 0.4% in July, disposable income rose 0.5%, and consumer spending gained 0.2% before adjusting for inflation. Real spending was essentially flat, and the personal saving rate stood at just 3.0%. That mix suggests households earned more but didn’t gain much extra purchasing power after prices, leaving less reserve if labor conditions or confidence weaken.

Big picture: Sticky prices don’t guarantee another rate increase, but they can keep borrowing costs elevated for longer than households and businesses expect. Anyone planning a mortgage, refinancing, or inventory purchase shouldn’t build the budget around an immediate policy rescue; income growth and cash reserves still need to carry the plan.

Source: U.S. Bureau of Economic Analysis

Meta agreed to pay up to $17.1 billion and change how minors use Facebook and Instagram under a proposed settlement with 50 state attorneys general. The deal still needs court approval, so it isn’t final yet.

The news: Meta would pay at least $12.1 billion, with the total rising if participation and claims reach specified levels. That’s paired with age-verification measures, default limits of two hours per day for minors, restrictions on notifications during school and overnight hours, and added choices around recommendation algorithms. The settlement would end claims that platform design encouraged compulsive use and harmed young people.

Bottom line: The money is enormous, but the operating rules may matter longer because they can reshape engagement, ad inventory, and product design. Parents should still use device-level controls, while social platforms should prepare for age checks and youth defaults to become standard compliance costs rather than one company’s exception.

Source: New York Attorney General

Abercrombie & Fitch posted record second-quarter sales of $1.3 billion, up 5%, for its 15th consecutive quarter of growth. It’s another sign that a strong brand can keep gaining even when shoppers are selective.

The news: Sales at the Abercrombie brands rose 8%, while Hollister increased 2% and total comparable sales were flat. Operating margin reached 19.9%, helped by roughly $100 million of tariff refunds that added about 7.9 percentage points. Management’s new outlook calls for full-year sales growth near 5%, adjusted earnings of $13.10–$13.60 per share, and at least $500 million of repurchases.

What’s next: The refunds boosted this quarter, but they won’t replace demand or pricing power next year. Watch whether Hollister’s comparable sales improve and whether Abercrombie can protect margin without unusual help, because the streak becomes more valuable when it rests on repeat customers instead of a one-time cost reversal.

Source: Abercrombie & Fitch

Kohl’s second-quarter comparable sales fell 0.9%, yet profit improved as gross margin expanded by more than three percentage points. The department store bought itself time, but the improvement came with a substantial assist.

The news: Revenue totaled $3.52 billion, gross margin reached 43.0%, and earnings were $1.28 per share. About $100 million of a $150 million tariff refund flowed through gross margin, helping operating income reach $261 million. Kohl’s now expects full-year sales to range from down 1.5% to flat, with earnings of $1.80–$2.40 per share, and it plans to restart repurchases.

Big picture: Better inventory control is useful, but refunds can’t become a retail strategy. Kohl’s will need stable traffic and fewer markdowns to hold the margin once the benefit rolls off, so the next quarter should be judged on full-price demand rather than whether another accounting tailwind keeps profit afloat.

Source: Kohl’s

China’s Li Auto delivered 98,330 vehicles in the second quarter, down 11.5% from a year earlier, while revenue fell 15.1% to RMB25.7 billion. Volume stabilized from the prior quarter, but pricing pressure still reached profitability.

The news: Vehicle margin improved to 9.4% from 6.1% in the first quarter, yet it remained far below the 19.4% reported a year ago. Li Auto lost RMB1.7 billion and used RMB1.3 billion of free cash flow. Management’s third-quarter outlook calls for 95,000–100,000 deliveries, which would return the company to modest annual growth, with revenue of RMB26.6–RMB28.0 billion.

Bottom line: More deliveries won’t solve the problem if discounts keep absorbing the benefit. Li Auto has to balance new-model launches with price discipline, while suppliers should prepare for automakers to keep pushing costs down until industry demand grows faster than available factory capacity.

Source: Li Auto

Canada will impose retaliatory tariffs on roughly $20 billion of U.S. goods beginning September 8 after Washington applied a 50% tariff to selected Canadian products. That’s a real escalation, but both sides left room to negotiate.

The news: Canada’s list includes steel, dairy products, appliances, and farm equipment, matching the value of affected trade. The United States also threatened auto tariffs starting January 1. Still, officials said talks can resume, and trade covered by the U.S.–Mexico–Canada agreement remains largely protected, leaving only about 5% of Canadian exports exposed to the newest measures.

What’s next: The September deadline creates leverage without making today the final outcome. Companies that move goods across the border shouldn’t wait for a deal; they’ll need updated landed-cost estimates, alternate suppliers, and contract language that explains who pays if tariffs remain after shipments are already committed.

Source: Associated Press

Switzerland’s Kudelski Group reported first-half revenue and other operating income of $171.8 million, down 1.5%, but its core digital-security business grew for the first time in five years. The headline decline hid improving operating momentum.

The news: Core digital-security revenue rose 0.7% to $104.7 million, cybersecurity revenue reached $45.1 million, and managed-detection bookings increased 69%. Internet-of-things revenue gained 5.1% to $20.3 million. The company’s $11.5 million operating loss before depreciation and amortization improved from $19.1 million, and it ended the period debt-free with $64.3 million in cash.

Big picture: A turnaround isn’t complete while the business remains unprofitable, but growth in recurring security services can make revenue more dependable. Customers and investors should watch conversion of those bookings into cash because a debt-free balance sheet provides time, not proof that the new mix can fund itself.

Source: EQS News

Q: Why’d the earnings report bring a baseball glove?

A: It didn’t want to drop the guidance.

Inflation hedge: an asset intended to preserve purchasing power when prices rise.

In a sentence: With the Fed’s preferred gauge still elevated, an inflation hedge can diversify a plan, but it shouldn’t replace emergency savings or a long-term asset mix.