This week, Wall Street shifts its focus from inflation data to the retail sector, as quarterly earnings from some of America’s biggest stores arrive amid growing questions about how consumers are really holding up. The reports from Walmart, Target, Home Depot and other major retailers will offer the clearest look yet at household demand after two months of cooling inflation, a surprise drop in July retail sales and a decline in consumer sentiment in August. Because the retailers’ fiscal second quarters closed in late July and early August, the results capture the period that included July’s sales drop — and with consumer spending making up roughly two-thirds of US economic activity, the read reaches well beyond the retail aisle.

Walmart reports Thursday morning. The retail giant previously flagged that shoppers appear to be “navigating financial distress,” pointing to changes in gas-buying habits. The company cut prices in response, and investors will be watching to see whether that strategy is paying off. As the largest US retailer by revenue and the country’s biggest private employer, Walmart’s commentary on stretched shoppers is widely followed as a real-time gauge of the broader consumer.

#earnings for the week of August 17, 2026 $WMT $ADI $BABA $TGT $HD $BIDU $BILL $HTHT $KLAR $TJX $LOW $ROST $AAP $AUNA $EL $DE $KEYS $BJ $YMM $NTES $SQM $ZTO $FUTU $AS $ATHM $BULL $BEKE $COTY $FLO $FN $FUFU $ZIM $WB $XP $PRE $VIK $JKHY $KC $FLXS $NSPR … pic.twitter.com/78bNHFW8Ao — Earnings Whispers (@eWhispers) August 14, 2026

Target reports Wednesday. The chain posted same-store sales growth last quarter for the first time in more than a year, but CFO Jim Lee has warned that weak consumer confidence could slow its momentum going forward. With the November–December holiday quarter still retail’s biggest sales period, the second-half outlooks issued alongside this week’s results carry as much weight as the quarterly numbers themselves.

Home Depot reports Tuesday. The home improvement retailer posted strong numbers last quarter but missed its same-store sales targets. Americans have been delaying big home improvement projects, pushing stores to focus more on professional contractors.

Consumer Confidence Falls Despite Easing Inflation

The University of Michigan’s consumer sentiment survey showed Americans grew more pessimistic in August. The decline was sharpest among older consumers, lower-income households and those without college degrees. Only 8% of survey respondents expect their income to grow faster than inflation over the next year.

Retail sales fell 0.6% month over month in July, worse than the 0.1% gain analysts had expected. The retail sales report tracks goods purchases, one reason executives’ commentary on store traffic and pricing is watched as a complement to the government figures. Inflation data from the Bureau of Labor Statistics showed only moderate improvement — enough for traders to pull back on bets that the Federal Reserve would raise rates in September, with markets now pricing about 70% odds of no move.

The S&P 500 finished last week up 0.4%. The Nasdaq rose 0.6%, while the Dow fell 0.6%.

The earnings calendar is crowded beyond the retail giants. Lowe’s reports Wednesday, giving home improvement a second read a day after Home Depot. Ross Stores and Deere and Company report Thursday, adding looks at off-price apparel and the farm-equipment cycle, and BJ’s Wholesale Club closes out the week on Friday. Alibaba and Baidu are also on the calendar, bringing China’s e-commerce and search giants into the same five-day stretch.

AI Spending Boom Runs Into Real-World Limits

Away from retail, the AI infrastructure story continues to develop. Goldman Sachs now estimates global AI data center spending could reach $1 trillion in 2026. JPMorgan puts the US figure at $697 billion, while Bank of America sees a path toward $1.2 trillion by 2027.

Analysts say money alone will not be enough. Chip shortages persist despite new manufacturing investment, skilled construction labor is in short supply, and regulatory pushback is growing — including a one-year moratorium in New York and a power audit in Texas. The squeeze is tightening as data centers take a growing share of the nation’s electricity: Energy Department researchers put the figure at roughly 4% of US consumption in 2023, with projections running as high as 12% by 2028.

Bloomberg New Energy Finance estimates a 19-gigawatt power shortfall for AI data centers by 2035 at current growth rates. One analyst noted that utilities may approve only 28% of power requests, partly because of multiple “phantom” applications filed by data center operators.

The Federal Reserve’s July meeting minutes are due Wednesday, giving investors a look at how policymakers are thinking about rates ahead of the September meeting.