📽 Poor projections

What’s going on here?

It might be a blockbuster summer for movies, but theaters’ prospects don’t look so great these days.

What does this mean?

With Tom Cruise back in action and the much-anticipated "Barbenheimer" weekend upon us, you’d think movie theaters would be on a “Barbie Dreamhouse” kind of high right now. But Mission Impossible’s premiere actually fell short of projections, casting an Oppenheimer-style shadow over the box office instead of Barbie’s bubbly brightness. Add in the first Hollywood strikes of both writers and actors in six decades – which have already halted several movie productions and shaken the silver-screen pipeline – and it’s no wonder Bloomberg analysts have trimmed their forecasts for the theater industry’s takings this year. Wall Street analysts, meanwhile, see the strikes keeping theater stocks in the doldrums, even if the box office takings outperform expectations.

Why should I care?

Zooming in: Reel problems.

The Hollywood strikes are a drama in their own right, with two main plotlines. First, there’s the issue of pay. Not every actor in Tinseltown is cashing Tom Cruise-level paychecks – most are just making ends meet, and the rise of streaming has only tightened their purse strings. Then there’s the specter of AI: writers are worried about machines churning out scripts, while actors fear studios could use the tech to mimic their performances. After all, if profit-hungry studios can get away with not paying a heap of extra salaries, then you can bet your bottom dollar they’ll try to.

For markets: Paying with plastic.

Despite the drama, there’s a Hollywood ending for some: the brands that feature in blockbuster movies. See, according to investment platform eToro, a company’s share price gets an 8% bump on average in the three-month prelude to a brand-centric film release. And Mattel, the company behind Barbie, can vouch for that: the firm’s stock price strutted up a whole 24% ahead of Barbie’s big-screen catwalk.

What’s going on here?

June’s record-breaking heatwave had stock flying off UK supermarket shelves, according to data out on Friday.

What does this mean?

June was the UK’s hottest on record, and it seems the heatwave, coupled with tempting summer sales, had consumers hitting the high street in droves. And because no self-respecting Brit lets a good heatwave pass without firing up the barbecue, it’ll come as no surprise that food sales bounced back last month, after King Charles’ coronation nibbled at spending in May. That said, the real stars of the show were actually non-food stores: after all, department stores and furniture retailers more than compensated for declines in fuel and clothing sales. The result of all that cash-splashing fun was that the total volume of goods sold in stores and online grew by a sunnier-than-expected 0.7% in June – a leap from May’s 0.1%, and well above the 0.2% economists had predicted.

Why should I care?

For markets: Giving and taking away.

Some economists think this data, which brings last quarter’s retail sales growth to 0.4%, could help the economy dodge a contraction. But the future is up in the air: on one hand, falling energy prices could leave consumers with more pocket change – but on the other, looming mortgage payment increases could gobble up that gain. And it seems consumers are already bracing for a chillier climate, with July seeing the biggest drop in consumer confidence in over a year.

The bigger picture: Sentenced to hard Labour.

Signs of cooling inflation earlier this week will have come as a relief to the ruling Conservative party. But given the UK’s lackluster progress compared to other major economies, they’re still under a whole lot of pressure. And after losing two out of three parliamentary seats in recent by-elections, and with Labour leading in the polls, the Conservatives will need to pull out all the economic stops to turn things around.