A Divided Fed & LVMH’s Succession Story

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**Ann Berry** (0:27)
Ford, Wingstop, P&G, it's an earnings bonanza day. We break down new results from some of the biggest consumer-facing names. Succession, a family exposé, pushes one famous luxury goods patriarch to an unexpected place. We take a billionaire's trip through X. And it's Fed Decision Day. Rates held steady, but that vote was far from unanimous. For Wednesday, July 29th, it's Brew Markets Daily, and I'm Ann Berry.
More market details to come, but first, the Fed, of course, the Fed. Keeping interest rates constant in a 9 to 3 vote by the Federal Open Markets Committee.
In June, rates were also kept constant at that 3.5% to 3.75% level. And this time, the Fed's official statement was almost identical. And I mean word for word, bar one, from the last one. So the difference? Well, in June, the committee voted unanimously for the hold rate study outcome. That vote was 12 to This time, not so. There were 3 votes against the monetary policy action. One coming from Beth Hammack, a former Goldman Sachs executive, and now president of the Cleveland Fed. I follow her on LinkedIn. It's worth doing. And she candidly has signalled this move in a series of posts about needing a data-driven, laser-focus on that 2% inflation target. She voted for a quarter-point hike alongside Neel Kashkari, Federal Reserve Bank of Minneapolis, and Laurie Logan of the Dallas Fed. Well, in his press conference, I was glued to the TV screen. I watched Chair Kevin Walsh reiterate his stance that, quote, there is no soft inflation target. There's only a target and it's 2%.
And he made it clear that he had expected dissent in the mode of a, quote, family fight.
Well, the overall view of the Fed was spelled out in its official release. It's pretty self-explanatory. I'll just read it here. It's thorough. Economic activity is expanding at a solid pace despite elevated uncertainty that owes in part to the conflict in the Middle East. Productivity growth and capital investment are strong. Job gains have kept pace with the workforce and the unemployment rate has changed little. Inflation remains elevated relative to the committee's 2% goal in part reflecting supply shocks that have driven price increases in certain sectors including energy. The committee will deliver price stability.
So where do we go from here? Well, late next month, we have the annual Jackson Hole Economic Policy Symposium. The who's who of central bank leaders globally and finance ministers turn up to the mountains. Their interviews and statements followed extremely closely for early signs of fall monetary policy shifts. And then of course, there's the next Fed rate decision due in September. Now, looking at the CME FedWatch tool, that's what the market uses to try and understand what the vote is in the markets for what's going on next. Clear from that, that the market's increasingly anticipating a US rate hike. Next time around, again, that's in September. We're going to keep on watching.
We're now on to other headlines from the day's trading session, starting with earnings from the auto sector. Shares in Ford, that's ticker F, rose more than 5% after the company beat second quarter earnings estimates and raised its full year outlook.

**John Creteau** (3:45)
The company said demand for its high margin pickup trucks and SUVs remains resilient despite that inflation and investors looked past the $1.3 billion net loss for the quarter, which was largely due to one time special charges related to Ford's pullback in all electric vehicles.

**Ann Berry** (4:00)
As for the company's flagship F series trucks, production is ramping on backup after two fires at an aluminium supplier last year crippled the supply chain. John wanted me to say aluminium, just for the record. Well, Ford estimates about 100,000 units of production were lost as a result of these fires. And after retreating from EV production and getting truck production back on track, shares in Ford are up 20% overall this year.

**John Creteau** (4:25)
Sticking with earnings, but bringing it home, shares of Procter & Gamble, tickler, ticker PG.

**Ann Berry** (4:30)
But I love tickler. Yes, exactly. Keep tickler in there.

**John Creteau** (4:33)
I feel tickled to talk about this. Ticker PG fell over 2.5% after the massive consumer goods company reported weaker than expected sales and issued disappointing guidance. The results came as consumers are becoming increasingly value conscious and delaying purchases by making everyday household products last longer.