Retailers hit the send button on push notifications, text messages and video streaming ads to reach US shoppers onCyber Monday, touting heavily-discounted cosmetics, electronics, toys, clothing and other products.
Spending online on Cyber Monday is set to reach as much as $12.4 billion, according to Adobe Digital Insights, which tracks data through Adobe’s Experience Cloud service for e-commerce platforms.
That would represent a record and an increase of more than 5.4% compared to a year ago, Adobe said.
As of mid-day, investors pointed to Amazon, Walmartand Apple as possible winners for the day.
“It’s a little early to see how this all plays out,” said Jim Worden, chief investment officer of Wealth Consulting Group, which holds shares of Amazon. “There’s still good spending” online. “While the prices of TVs and some electronics have come down a lot, I don’t know how much the average consumer is going to nibble on these,” he said.
“One of the biggest things that we would be looking at is if the discounts throughout the day started to deepen,” said Brian Mulberry, client portfolio manager at Zacks Investment Management, which owns Amazon and Walmart stock.
But Amazon and Apple are “not having to discount things as much,” he said, which indicated possible healthy consumer demand for their merchandise on Cyber Monday.
Retail consultant Carol Spieckerman said at mid-day on Monday that “the biggest discounts are still ahead, and shoppers are all too aware of that.”
She pointed to lackluster store traffic onBlack Friday, the day after Thanksgiving, as a sign that shoppers were ultra picky.
Overall Black Friday sales in stores and online rose by 2.5% compared to a year ago, according to Mastercard SpendingPulse, which measures all payment types.
Online US sales rose by 8.5% while in-store US sales increased just 1.1%, it said.
Charles Sizemore, chief investment officer at Sizemore Capital Management, said he expects retailers to have to discount more in the weeks ahead.
This makes him worried about profit margins at a time input and labor costs have not come down and shoppers continue to be picky. “I really think margins are going to be depressed,” during the holiday season,” said Sizemore, whose firm holds about $2 million of shares each in Walmart and Target.
Last-minute shoppers on Monday could spend $4 billion between 6 p.m. and 11 p.m. ET alone, said Vivek Pandya, lead analyst at Adobe Digital Insights. “Consumers are going to be concerned about discounts weakening after that,” he added.
Amazon began marketing Cyber Monday Deals as early as Saturday, including up to 46% off some Instant Pot kitchen appliances, 37% off certain Vitamix blenders, and 35% on Amazon devices including a 55-inch Amazon Fire TV.
Walmart, eager to capture market share, slashed prices on Sunday night, joining the trend of retailers’ early discounts on major shopping days. On Monday, Walmart stepped up discounts on some clothing to 60%, up from the 50% it offered on Black Friday.
Apple offered Apple Gift Cards of up to $200 with eligible purchases.
The rate of inflation has risen by more than expected on the back of fuel and food price pressures, according to official figures which have prompted accusations of an own goal for the chancellor.
The Office for National Statistics (ONS) reported a 3.6% level for the 12 months to June – a pace not seen since January last year.
That was up from the 3.4% rate seen the previous month. Economists had expected no change.
ONS acting chief economist Richard Heys said: “Inflation ticked up in June driven mainly by motor fuel prices which fell only slightly, compared with a much larger decrease at this time last year.
“Food price inflation has increased for the third consecutive month to its highest annual rate since February of last year. However, it remains well below the peak seen in early 2023.”
A key driver of food inflation has been meat prices.
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Beef, in particular, has shot up in cost – by more than 30% over the past year – according to Association of Independent Meat Suppliers data reported by FarmingUK.
Image: Beef has seen the biggest percentage increase in meat costs. Pic: PA
High global demand alongside raised production costs have been blamed.
But Kris Hamer, director of insight at the British Retail Consortium, said: “While inflation has risen steadily over the last year, food inflation has seen a much more pronounced increase.
“Despite fierce competition between retailers, the ongoing impact of the last budget and poor harvests caused by the extreme weather have resulted in prices for consumers rising.”
It marked a clear claim that tax rises imposed on employers by Rachel Reeves from April have helped stoke inflation.
Balwinder Dhoot, director of sustainability and growth at the Food and Drink Federation, said: “The pressure on food and drink manufacturers continues to build. With many key ingredients like chocolate, butter, coffee, beef, and lamb, climbing in price – alongside high energy and labour expenses – these rising costs are gradually making their way into the prices shoppers pay at the tills.”
Chancellor Rachel Reeves said of the data: “I know working people are still struggling with the cost of living. That is why we have already taken action by increasing the national minimum wage for three million workers, rolling out free breakfast clubs in every primary school and extending the £3 bus fare cap.
“But there is more to do and I’m determined we deliver on our Plan for Change to put more money into people’s pockets.”
The wider ONS data is a timely reminder of the squeeze on living standards still being felt by many households – largely since the end of the COVID pandemic and subsequent energy-driven cost of living crisis.
Record rental costs alongside elevated borrowing costs – the latter a result of the Bank of England’s action to help keep a lid on inflation – have added to the burden on family budgets.
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8:30
Is the cost of living crisis over?
Most are still reeling from the effects of high energy bills.
The cost of gas and electricity is among the reasons why the pace of price growth for many goods and services remains above a level the Bank would ideally like to see.
Added to that is the toll placed on finances by wider hikes to bills. April saw those for water, council tax and many other essentials rise at an inflation-busting rate.
The inflation figures, along with employment data due tomorrow, are the last before the Bank of England is due to make its next interest rate decision on 7 August.
The vast majority of financial market participants, and many economists, expect a quarter point cut to 4%.
That forecast is largely based on the fact that wider economic data is suggesting a slowdown in both economic growth and the labour market – twin headaches for a chancellor gunning for growth and juggling hugely squeezed public finances.
Professor Joe Nellis, economic adviser at the advisory firm MHA, said of the ONS data: “This is a reminder that while price rises have slowed from the highs of 2021-23, the battle against inflation is far from over and there is no return to normality yet – especially for many households who are still feeling the squeeze on essentials such as food, energy, and services.
“However, while the Bank of England is expected to take a cautious approach to interest rate policy, we still expect a cut in interest rates when the Monetary Policy Committee next votes on 7th August.
“Despite inflation at 3.6% remaining above the official 2% target, a softening labour market – slowing wage growth and decreasing job vacancies – means that the MPC will predict inflation to begin falling as we head into the new year, justifying the lowering of interest rates.”
Now details of the enormous accidental data breach by a British soldier that put thousands of Afghans’ lives at risk can be discussed publicly – Sam and Anne try to address some of the biggest questions on this episode.
They include:
Why did the government break the glass on using a superinjunction?
Has anyone been sacked?
Why did the Labour government keep the superinjunction in place for so long?
There’s still a bit of time to go over Rachel Reeves’ Mansion House speech. Did it reassure financiers and investors?
An Afghan man who worked for the British military has told Sky News he feels betrayed and has “completely lost (his) mind” after his identity was part of a massive data breach.
The man, who spoke anonymously to Sky News from Afghanistan, says he worked with British forces for more than 10 years.
But now, he regrets working alongside those troops, who were first deployed to Afghanistan in 2001.
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1:59
Afghans being relocated after data breach
“I have done everything for the British forces … I regret that – why (did) I put my family in danger because of that? Is this is justice?
“We work for them, for [the] British, we help them. So now we are left behind, right now. And from today, I don’t know about my future.”
He described receiving an email warning him that his details had been revealed.
He said: “When I saw this one story… I completely lost my mind. I just thought… about my future… my family’s.
“I’ve got two kids. All my family are… in danger. Right now… I’m just completely lost.”
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The mistake by the Ministry of Defence in early 2022 ranks among the worst security breaches in modern British history because of the cost and risk posed to the lives of thousands of Afghans.
On Tuesday, a court order – preventing the media reporting details of a secret relocation programme – was lifted.
Defence Secretary John Healey said about 6,900 Afghans and their family members have been relocated or were on their way to the UK under the previously secret scheme.
He said no one else from Afghanistan would be offered asylum, after a government review found little evidence of intent from the Taliban to seek retribution.
But the anonymous Afghan man who spoke to Sky News disputed this. He claimed the Taliban, who returned to power in 2021, were actively seeking people who worked with British forces.
“My family is finished,” he said. “I request… kindly request from the British government… the King… please evacuate us.
“Maybe tomorrow we will not be anymore. Please, please help us.”