Good Afternoon. On this day in 1839, France unveiled the daguerreotype process to the public, helping photography capture what the eye could see and preserve it. Wednesday’s economy also needed a sharper lens. The Federal Reserve left the door open to higher rates, the Treasury eased strain in the bond market, and retailers delivered growth that wasn’t always as repeatable as the headline suggested.

That’s the picture worth keeping. Consumers haven’t disappeared, companies can still grow, and markets welcomed some relief. But one-time refunds, policy support, and acquisitions can flatter the frame. Before planning around a strong number, it’s worth asking what produced it and whether it’ll still be there next quarter.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

🔢 Big number: $994 million — that’s the pretax benefit Target recorded from a tariff refund. It helped produce a much brighter profit figure, but it won’t tell readers how the stores performed without it.

The Federal Reserve didn’t raise rates in July, but Wednesday’s minutes showed that holding steady wasn’t the same as declaring victory. Many officials thought another increase could be necessary if inflation failed to cool, turning each new price report into evidence for a decision that’s still open.

The news: It’s a conditional warning from a divided committee. The Fed voted 9–3 to keep its short-term rate near 3.6% at the July 28–29 meeting, with three policymakers preferring a quarter-point increase. The minutes didn’t identify exactly how many of the 19 participants expected higher rates, yet they showed broad concern that inflation could remain too firm. Markets still expect no move in September, while a later increase remains possible if energy, tariffs, or demand keep prices elevated.

Bottom line: Businesses and households can’t treat a pause as a promise that borrowing costs have peaked. A project that works only with cheaper financing needs a backup case, and variable-rate borrowers may want more room in their monthly budget. The next inflation and employment reports will matter together: the Fed’s challenge is cooling prices without pressing harder than a softer labor market can handle.

Source: Associated Press

The bond market had been making nearly everything harder. Rising long-term yields threatened mortgages, corporate borrowing, and stock valuations, so the Treasury stepped in with a larger plan to purchase older government debt. Wednesday’s relief was real, though it didn’t erase the reason investors demanded higher yields.

The news: It’s a liquidity move aimed at making long-dated bonds easier to trade. Treasury said it will more than double the size of its purchases of older, longer-term government securities beginning in September. Buying those bonds adds a dependable buyer to a market facing inflation worries and enormous federal financing needs. Long-term yields moved lower after the announcement, helping stocks recover from a three-day slide and lifting the exchange-traded fund that tracks seven- to ten-year Treasurys.

What’s next: A buyback can improve market plumbing, but it can’t reduce the government’s total debt or settle the inflation debate. Companies refinancing soon may benefit if yields stay lower, while households could eventually see some relief in mortgage and loan pricing. Watch whether private demand returns after the initial response; lasting improvement needs investors to accept the debt supply without repeated support.

Source: Axios

Target’s shoppers came back in the second quarter, and the traffic gain was more encouraging than any single profit figure. The retailer’s stores and website both improved, but a large tariff refund did some heavy lifting for earnings. That’s why the rebound deserves attention and an adjustment.

The news: It’s stronger demand paired with an unusual benefit. Net sales rose 5.3% to $26.5 billion, comparable sales increased 3.8%, and customer traffic grew 3.6%. Digital comparable sales gained 8.7%, while advertising, marketplace, and other non-merchandise revenue rose more than 20%. Earnings reached $4.11 per share, but Target recorded a $994 million pretax tariff refund worth $1.65 per share. Excluding that refund, management said earnings still increased 20% and lifted its underlying full-year outlook.

Big picture: Traffic and digital growth show the operating recovery isn’t imaginary, yet the refund makes the headline profit a poor starting point for next year’s plan. Suppliers should focus on sell-through and order consistency, while shoppers may benefit from the 10,000 price reductions Target says it has made. The next test is whether comparable sales remain positive after back-to-school demand fades and the refund leaves the comparison.

Source: Target

Lowe’s grew much faster on the top line than its stores did on a comparable basis. Acquisitions and professional customers added momentum, while big-ticket do-it-yourself demand stayed soft. The result isn’t a housing recovery, but it does show where home-improvement spending remains dependable.

The news: It’s a wider business sitting on a nearly flat core. Quarterly sales rose to $26.0 billion from $24.0 billion, while comparable sales increased just 0.2%. Professional services, home services, and online sales each grew, with digital sales up 15.7%. Adjusted earnings rose 1.6% to $4.40 per share, including an 11-cent benefit from a tariff refund. Management now expects about $92 billion of full-year sales and flat comparable sales, the low end of its prior range.

Bottom line: Acquisitions can add revenue before households feel ready for another major remodel, but they can’t make organic demand stronger by themselves. Contractors should have more bargaining power with retailers competing for professional business, while homeowners may keep favoring maintenance over transformation. Watch comparable sales and operating margin together; the strategy works when new capabilities produce repeatable profit, not merely a larger revenue base.

Source: Lowe’s

Estée Lauder finally ended a three-year run of annual sales declines, offering evidence that its turnaround is reaching customers as well as the cost line. Fragrance, China, and a faster pace of new products helped, though rebuilding a beauty portfolio can’t depend on one strong quarter.

The news: It’s a recovery with broader participation. Fiscal fourth-quarter sales rose 7% to roughly $3.6 billion, with organic sales up 5% for a fourth consecutive quarter of growth. Full-year reported sales increased 5% to about $15.0 billion, while organic sales rose 3%. Fragrance grew fastest for the year, and Mainland China produced strong growth as the company refreshed products and marketing. Management also reaffirmed its fiscal-2027 sales view and raised its adjusted operating-margin outlook while continuing a restructuring that’s expected to eliminate roughly 10,000 positions.

What’s next: Cost cuts can help margins quickly, but brand demand has to carry the turnaround after the easiest savings are captured. Retailers and suppliers should watch whether new launches win full-price purchases instead of requiring heavier promotion. Estée Lauder’s next scorecard is straightforward: keep organic growth positive, protect the margin gains, and prove the recovery can travel beyond fragrance and China.

Source: Estée Lauder

British inflation accelerated in July even though underlying services pressure eased. Household energy costs did most of the damage after the regulated price cap reset, showing how a scheduled bill change can overwhelm otherwise helpful details. The Bank of England’s job didn’t get simpler.

The news: It’s a 2.9% annual consumer-inflation rate, up from 2.6% in June, with prices rising 0.3% during the month. Housing and household services delivered the largest upward contribution as gas prices jumped 14.7% from June. The energy-cap change lifted a typical annual bill by £221 to £1,862. Core inflation held at 2.6%, while services inflation slowed to 3.4% from 3.6%, suggesting domestic pressure didn’t worsen across every category.

Big picture: A regulated increase still hits a household’s cash flow even when economists can explain it as a timing effect. Families may want to rebuild winter energy buffers now, while businesses should separate utility costs from wage and service trends before changing prices. The central bank will be watching whether the energy jump spreads into expectations and contracts; containment would matter more than one uncomfortable headline.

Source: Office for National Statistics

The euro area’s inflation problem also moved back toward energy. July’s final reading confirmed that price growth accelerated, keeping the region above the European Central Bank’s target even as inflation outside volatile categories looked steadier. Europe hasn’t escaped the same fuel risk facing Britain and the United States.

The news: It’s a 2.9% annual inflation rate for the euro area, up from 2.8% in June, while the broader European Union reached 3.0%. Energy prices increased 10.3% from a year earlier and contributed nearly a full percentage point to the headline rate. Services added more because they occupy a larger share of household budgets, but inflation excluding energy held at 2.2%. Spain was the highest among the largest euro-area economies at 3.9%, compared with 2.9% in Italy, 2.8% in Germany, and 2.4% in France.

Bottom line: The mix says the central bank can’t ignore the headline, yet it also shouldn’t treat every energy shock as proof that domestic demand is overheating. Households and manufacturers remain exposed to fuel and utility costs, so hedges, efficiency projects, and cash cushions still have practical value. The key question is whether energy stays isolated or begins lifting wages, services, and longer-term expectations.

Source: El País

Kuaishou’s video-generation business is growing at a striking rate, but the company’s established operations paid more of the bill this quarter. Kling AI is becoming meaningful revenue, while lower profit and margin show what it costs to train models, add computing capacity, and find a durable business model.

The news: It’s rapid AI growth inside a slower company. Quarterly revenue rose 1.4% to 35.5 billion yuan, while gross margin fell to 51.6% from 55.7%. Profit declined to 3.2 billion yuan from 4.9 billion yuan, and adjusted profit fell to 3.9 billion yuan. Kling AI revenue exceeded 850 million yuan and grew more than 200%, but research and development expense climbed to roughly 4.6 billion yuan. Monthly active users rose 11.5% to 797.3 million, while live-streaming revenue declined 13.5%.

What’s next: Fast-growing AI revenue can’t carry the valuation alone if margins across the larger platform keep shrinking. Customers should watch product quality and pricing as competition expands, while businesses evaluating video tools should compare usage value with switching costs and data controls. Kuaishou needs Kling to become profitable enough to offset heavier computing and development spending without weakening the audience and advertising engine that funds it.

Source: Kuaishou

Q: Why’d the rate decision bring a bookmark?

A: It’d planned to hold its place.

how much reported profit comes from repeatable operations rather than temporary gains, accounting adjustments, or one-time events.

In a sentence: Target’s quality of earnings isn’t captured by headline profit alone because a large tariff refund won’t recur every quarter.

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