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The final reading of the Eurozone Composite PMI for March was 50.7, below the expected 50.5 and the previous reading of 50.5.The Eurozones final March services PMI was 50.2, below the expected 50.1 and the previous reading of 50.1.April 7th - Surveys show that German demand weakened due to the Middle East wars, causing a sudden loss of momentum in service sector business activity in March. The final S&P Global German Services PMI for March fell to 50.9 from 53.5 in February, the lowest level since September last year, slightly below the preliminary reading of 51.2. Phil Smith, Vice President of Market Intelligence at S&P Global, attributed the economic slowdown to rising gasoline prices and increased uncertainty. He added that despite significant cost increases, service providers failed to pass on higher price increases to customers due to weak demand. Smith stated, "The decline in new business inflows for the first time since September last year clearly demonstrates the direct impact of the Middle East wars on demand, while the significant drop in business expectations highlights the dampening effect of rising energy prices, supply chain disruptions, and generally high uncertainty on growth over the next year." Business expectations fell to a three-month low of 53.4 in March, below the long-term average of 56.7. The final Composite PMI also fell to 51.9 in March from 53.2 in February, a three-month low, entirely due to the slump in the service sector.Germanys final composite PMI for March was 51.9, in line with expectations and unchanged from the previous month.Germanys final March services PMI was 50.9, below the expected 51.2 and the previous reading of 51.2.

Costco Margins Are Impacted by Growing Freight And Labor Expenses, And The Stock Price Falls

Charlie Brooks

May 27, 2022 09:50

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Costco Wholesale Corp (NASDAQ:COST) announced a decline in gross margins on Thursday, impacted by rising freight and labor expenses across the United States. The news sent shares of the membership-only retailer down 2% and overshadowed an otherwise positive quarterly report.


Fresh COVID-19 lockdowns in China and the Russia-Ukraine conflict have compounded the problem for U.S. businesses.


Costco announced that it would increase prices in certain food categories in order to battle inflation.


Retailers such as Walmart (NYSE:WMT) Inc and Target Corp (NYSE:TGT) have warned that decades-high inflation will have a negative impact on their earnings, as shoppers hesitate from purchasing non-essential and high-margin goods.


The average Costco buyer earns more than the average Walmart and Target shopper, allowing Costco to generate quarterly earnings and revenue that easily exceeds expectations.


Memberships and sales have been boosted by the company's efforts to keep gas prices several cents below the national average.


Costco, in contrast to Walmart, reported that there has not been a significant shift from branded products to its private label product, Kirkland Signature.


"We aren't really observing a decline in commerce. This year, more money is being spent on tickets, dining out, travel, tires, and gasoline "In a post-earnings conference call, Robert Nelson, senior vice president of finance and investor relations, said.


Costco's gross margins decreased by 99 basis points in the third quarter.


According to data from Refinitiv IBES, Costco's total sales for the quarter ending May 8 increased by 16 percent to $52.60 billion, surpassing analysts' projections of $51.71 billion.


Excluding adjustments, Costco's earnings per share were $3.17, exceeding analysts' expectations of $3.03.

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