Stocks rise even as Fed signals three rate hikes next year

By CNN Business

Updated 5:39 p.m. ET, December 15, 2021
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9:02 a.m. ET, December 15, 2021

Bad sign for housing? Lowe's outlook underwhelms

From CNN Business' Paul R. La Monica

A robust housing market has continued to prop up America's economy. But are consumers finally tapped out? Home improvement retailer Lowe's (LOW) issued revenue and earnings per share guidance for 2022 that was below analysts' forecasts.

Lowe's said that same-store sales, which measure the performance of locations open at least a year, are expected to be flat to down 3% next year. Wall Street had been expecting an increase of 2.1% according to Refinitiv.

Shares of Lowe's tumbled 2% in early trading Wednesday. Rival Home Depot (HD) fell more than 1%. Both stocks have surged in 2021 thanks to the housing boom and strong retail spending. Lowe's shares have soared nearly 60% this year while Home Depot's are up more than 50%. That makes Home Depot the best performing stock in the Dow.

Still, there are growing concerns that consumers may be tapped out. The US government also reported Wednesday that retail sales for November grew at a much slower rate than economists had predicted. That is doubly bad for Lowe's and Home Depot since their success is highly dependent on healthy overall demand for retail and a vibrant housing market.

8:44 a.m. ET, December 15, 2021

Retail sales: Holiday shopping gets off to a sluggish start

From CNN Business' Anneken Tappe and Nathaniel Meyersohn

People shop in The Galleria mall during Black Friday on November 26, 2021 in Houston, Texas. 
People shop in The Galleria mall during Black Friday on November 26, 2021 in Houston, Texas.  (Brandon Bell/Getty Images)

US retail sales grew by 0.3% in November, a sharp decline from the previous month and less than economists had predicted.

Even so, sales were 16.1% higher than in the same period last year.

Americans have been struggling with rising prices this year, but economists and retail sector experts still believe that the holiday shopping season will be strong.

8:01 a.m. ET, December 15, 2021

The Fed's huge challenge: Taming inflation, without starting a recession

From CNN Business' Matt Egan

President Joe Biden is taking the political punches for high inflation. But price stability is the responsibility of the Federal Reserve, not the White House. And prices are anything but stable right now.

Consumer prices spiked in November at the fastest pace since 1982. Producer prices soared by nearly 10%, suggesting inflationary pressures are not subsiding anytime soon.

The good news is that the Federal Reserve knows how to fight inflation: By tapping the brakes on the economy. The bad news is the harder it hits the brakes, the greater the risk of an accident that ends the economic recovery, freaks out financial markets -- or both.

Read more here

7:37 a.m. ET, December 15, 2021

Stocks steady ahead of the Fed's big day

From CNN Business' David Goldman

US stock futures were mostly unchanged Wednesday morning as investors await the results of the Fed’s final meeting of 2021.

Wall Street expects the Fed to leave rates near zero -- but believes the Fed will say it is prepared to speed up the winddown of its asset purchases that it had built up during its emergency stimulus program. But rising Covid cases make the Fed’s tightrope walk even more precarious.

  • Dow futures were up 30 points or 0.1%.
  • S&P 500 futures were flat.
  • Nasdaq futures were 0.3% lower.
8:00 a.m. ET, December 15, 2021

Today's Fed meeting will be crucial as inflation soars

From CNN Business' Matt Egan

At 2 pm ET today, the Fed is scheduled to release its new policy statement.

The central bank is expected to:

1) acknowledge worsening inflationary pressures

2) speed up the demise of its bond-buying stimulus program

3) ramp up its inflation projections for at least 2022

4) acknowledge recent strength in the jobs market.

During the 2:30 pm ET press conference, Powell will need to reassure the public that the Fed is serious about taming inflation. But Powell will also need to reassure investors that the Fed won’t overdo it and sink the US economy. Not an easy task ahead for Powell. 

8:07 a.m. ET, December 15, 2021

Retiring Boomers, not lazy Millennials, are driving the labor shortage

From CNN Business' Allison Morrow and Anneken Tappe

One of the more insidious myths this year was that young people didn't want to work because they were getting by just fine on government aid. People had too much money, went the narrative.

Only trouble is, the numbers don't back it up.

Instead, early retirement — whether forced by the pandemic or made possible otherwise — is playing a big role in America's evolving labor market.

People have left the workforce for myriad reasons in the past two years — layoffs, health insecurity, child care needs, and any number of personal issues that arose from the disruption caused by the pandemic. But among those who have left and are not able to -- or don't want -- to return, the vast majority are older Americans who accelerated their retirement.

Read more here