Kroger lowered its full-year same-store sales outlook, as shoppers’ budget constraints and concerns about cyclospora resulted in lower spending. The grocery-store chain now expects annual same-store sales to increase by 0.2% to 0.8%, compared with its previous projection of 1% to 2% growth. It reaffirmed the rest of its outlook. The lower guidance accounts for consumers spending less at Kroger’s stores. While traffic increased in the quarter, shoppers were buying fewer items on their trips, Chief Executive Greg Foran told analysts on a call Friday. “Reductions in SNAP benefits, higher fuel prices and softer consumer confidence are all putting pressure on household budgets,” Foran said. “Customers are buying more on need.” Same-store sales in the second quarter increased 0.2%, below Wall Street’s estimates of 0.8% growth. Total revenue for the quarter rose 2% to $34.62 billion, missing analysts’ forecast of $34.64 billion. Kroger’s stock declined 3% to $55.50 in premarket trading. Along with budget constraints, the cyclospora outbreak also deterred shoppers. The parasite, which made headlines for contaminating fresh produce, shaved about 0.35 percentage points off of Kroger’s same-store sales growth in the quarter.

The Switzerland stock market closed modestly higher on Friday, in line with markets across Europe, as a sharp drop in oil prices helped lift sentiment. The benchmark SMI, which climbed to 13,871.65 around late afternoon, ended with a gain of 35.17 points or 0.26% at 13,775.27. Logitech International jumped nearly 3.5%. Amrize, UBS Group, Richemont, Swiss Re, Helvetia Baloise Holding, ABB and Sandoz Group gained 1%-1.5%. Galderma Group, Swiss Life Holding, VAT Group, Straumann Holding, Swisscom and Zurich Insurance advanced 0.5%-0.8%. Lindt & Spruengli ended lower by about 2.6%. Sonova drifted down 1.4%. Partners Group, Alcon, Kuehne + Nagel, Lonza Group and SGS lost 0.6%-1.1%. In economic news, consumers in Switzerland remained less pessimistic in August. The consumer sentiment index climbed to -33.0 in August from -40.0 in the corresponding month last year. Among the four components, the sub-index measuring expected economic development strengthened markedly to -36 from -66, and the index for the past financial situation of households increased to -38.8 from -40.4.

Europe
European markets closed on a firm note on Friday as oil prices fell sharply on International Energy Agency's downward revision in global oil demand forecast for the year and prospects of Gulf foreign ministers securing support from their Iranian counterpart for a temporary arrangement to manage shipping through the Strait of Hormuz. The pan European Stoxx 600 gained 0.49%. The U.K.'s FTSE 100 ended with a gain of 0.39%, while Germany's DAX and France's CAC 40 climbed 0.82% and 0.78%, respectively. Switzerland's SMI finished with a gain of 0.26%. Among other markets in Europe, Austria, Belgium, Finland, Greece, Ireland, Netherlands, Norway, Poland, Portugal, Spain, Sweden and Türkiye closed higher. Czech Republic, Denmark, Iceland and Russia ended weak. In the UK market, Natwest Group, Barclays, Lloyds Banking Group, HSBC Holdings and Standard Chartered gained 1.2%-2.2%. Lion Finance, Endeavour Mining, Fresnillo, IAG, Computacenter, Rolls-Royce Holdings, Informa, Howden Joinery Group, Investec, Weir, Halma, Diploma, IMI and Hiscox climbed 1%-2.3%. LSEG tumbled 3.2%. The Sage Group dropped about 2.2%. Smith & Nephew, Next, BAE Systems, JD Sports Fashion, Reckitt Benckiser, Burberry Group, Rentokil Initial and Tritax Big Box REIT lost 1%-1.7%. In the German market, Infineon jumped 5%. Deutsche Telekom, Siemens and Siemens Energy gained about 2.5%. Hochtief, MTU Aero Engines, Commerzbank, Daimler Truck Holding, Munich RE and Vonovia also closed notably higher. In the French market, Stellantis moved up more than 3%. Safran, Renault, LVMH, STMicroelectronics, Kering, Airbus, Legrand, Capgemini, Schneider Electric, L'Oreal, Societe Generale and BNP Paribas gained 1%-2.5%.

United States
U.S. stocks snapped a four-session losing streak as an interruption to the torrid run in oil prices offset a reading of higher consumer inflation. The Dow Jones Industrial Average rose 509.19 points, or 0.98%, to 52573.29. The S&P 500 added 65.28 points, or 0.86%, to 7656.98 and the tech-heavy Nasdaq Composite rose 251.31 points, or 0.96%, to 26333.04. One brokerage said the inflation data and recent spikes in Treasury yields would force Federal Reserve Chairman Kevin Warsh's hand. "If the Fed were to refrain from hiking after today's data, it would risk a significant selloff at the long end," strategists at brokerage Bank of America Global Research said in a note to clients, warning of potential disruptions in long-term bonds. Oracle shares slipped 1.7% to $150.28 even after the business software maker-turned-hyperscaler logged a jump in cloud-computing revenue, suggesting its pivot towards AI was paying off. Rising interest rates could still make multibillion-dollar data-center loans challenging for Oracle to digest. Kroger shares rose 2.7% to $58.49. The grocery-store chain lowered its full-year same-store sales outlook due to shoppers' budget constraints and concerns about the cyclospora contamination. Canadian financial institutions Bank of Montreal and Sun Life Financial pledged 75 billion Canadian dollars ($54.22 billion) in private-sector capital to support Prime Minister Mark Carney's infrastructure push.

Asia
There is no clear trend to be seen on the stock markets in East Asia and Australia as the new week gets underway. In South Korea, the technology-heavy Kospi is down 2.7 per cent. The Nikkei 225 index in Tokyo is down 1 per cent, whilst the broader Topix is up 0.6 per cent. The Shanghai Composite Index is holding up well, and the Hang Seng Index in Hong Kong is up 0.4 per cent. In Sydney, the market is holding up well.

Bonds
The yield on the policy-sensitive 2-yearU.S. Treasury rose 0.095 percentage point to 4.642%. The yield on the 10-year Treasury rose 0.031 percentage point to 4.974%, the highest close since October 2023. The yield on the 30-year bond fell 0.007 percentage point to 5.354%, but rose sharply for the week. The 30-year yield has now gained for eight of the last 11 weeks.

Analysis