Levi, Pepsi, Delta Report; Fed Minutes, PMIs Due
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- Levi Strauss, PepsiCo, and Delta Air Lines report earnings this week (Wednesday evening, Thursday morning, and Friday before the bell, respectively), serving as the primary read on consumer health after the recent inflation rebound and the slower-moving drop in gas prices — WTI crude is down 27% from a month ago while retail gas is only 10.5% lower.
- Delta Air Lines is the most informative of the three reports, offering readthroughs on falling crude prices translating to jet fuel; Delta owns its own oil refinery, a structural edge among U.S. airlines, and jet fuel/diesel middle distillate dynamics matter for FedEx's freight costs.
- PepsiCo will provide insight into food inflation and demand dynamics amid growing GLP-1 adoption, notable given the portfolio's stake in Eli Lilly; Pepsi and other food brands are leaning into protein-infused products as GLP-1 use rises.
- Two services PMI releases land back-to-back Monday — S&P Global at 9:45 a.m. ET and the ISM services PMI at 10 a.m. ET — covering activity across healthcare, real estate, food, and finance.
- Federal Reserve June policy meeting minutes release Wednesday at 2 p.m. ET, with the National Association of Realtors' existing home sales for June and initial jobless claims arriving Thursday; the portfolio's Home Depot position is a bet that mortgage rates will eventually decline and unleash pent-up housing demand.
- The semiconductor sector (SOXX and SMH) traded within a few percentage points of its 50-day moving averages after vicious selling in the final two trading days of last week, testing whether buyers step in to support the AI trade.
- Corning fell 23% across two days after the portfolio trimmed its position Tuesday following a parabolic move, while Johnson & Johnson finished the week at a record close as the rotation away from first-half AI winners continued.
Why it matters: With formal Q2 earnings season not starting until July 13, Levi's, Pepsi, and Delta serve as early consumer-spending gauges — Pepsi's commentary on GLP-1 demand dynamics ties directly to the portfolio's Eli Lilly stake. Wednesday's Fed minutes arrive after last Thursday's weaker-than-expected June jobs report, which already fueled hopes of a less hawkish central bank.
