Daily newsletter · Wed 26 Aug 2026
 | SharespectiveWall street, before your first coffee | Wed 26 Aug 2026 Issue 235 |
 The Foot Locker Bill Plus: the long bond finally caught a break, and a falling oil price did most of the work. |
Good morning. It's Wednesday, and one company had a far worse day than the market did. Dick's Sporting Goods fell 30.7%, its roughest session since 2023, after telling investors the Foot Locker chain it bought is going backwards and this year's profit will land about US$3 a share below what analysts had pencilled in. Everything else was quietly fine: the S&P 500 added 0.32%, the Nasdaq 0.66%, and the Dow closed up for a third day running.
Underneath, bond yields fell for a second session, crude kept sliding, and Nvidia snapped a seven-day losing streak the day before it reports. A market this composed while a large retailer loses a third of itself in an afternoon is either admirable discipline or a very short attention span.
Market snapshot
| S&P 5007,677.28▲ 0.32% | | NASDAQ26,151.30▲ 0.66% | | NZX 5013,992.72▲ 0.80% |
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| ASX 2009,165.00▲ 0.68% | | USD/NZD1.6731▼ 0.32% | | USD/AUD1.3961▼ 0.19% |
US levels are the official 4pm New York close on Tuesday 25 August. The NZX 50 and ASX 200 are Tuesday's local closes, and currencies were taken late in Tuesday's New York session.
| RETAIL |
Dick's bought Foot Locker to get bigger, and Tuesday was the bill arriving
Revenue came in at US$5.59 billion against US$5.65 billion expected, and adjusted earnings at US$3.53 a share against US$3.78. Revenue was up 53.2% on last year, which sounds spectacular until you remember nearly all of it is Foot Locker being bolted on rather than anything extra sold. The Dick's stores grew comparable sales 4.9%. Foot Locker, measured as if it had been owned all along, shrank 3.6%.
Where the money went. Adjusted operating income fell to 8.1% of sales from 13.0% a year ago, and management was blunt about why: athletic footwear and apparel has turned promotional, which is the industry's polite phrase for everyone discounting at once. So it cut full-year guidance to US$11.00–12.00 a share against a consensus of US$14.20. That is not a revision. That is a different year.
Nike and Academy Sports fell on the same warning, because if Dick's cannot sell shoes at full price then neither can anyone else selling those shoes. Dick's has spent the year arguing that Foot Locker bought it scale. Tuesday showed what scale costs when the market turns.
The catch the acquisition math has not changed, but the assumptions underneath it have. A bigger footprint helps when footwear is scarce and priced firmly, and hurts when the whole category is on special. Whether this was one bad quarter or several comes down to whether the discounting eases before Christmas. |
| MARKETS |
The long end of the bond market got a second good day, and oil paid for it
The 10-year Treasury yield fell about seven basis points to 4.629% and the 30-year shed six to 5.163%, a second straight session of relief at the long end. The cause was crude, which slid again as traders decided Washington's newest sanctions on Iran threatened fewer actual barrels than a military escalation would have. Cheaper oil means less imported inflation, and less reason to demand a fat yield for lending to the government for thirty years.
Why the long end came unstuck. Last week the 30-year touched 5.34%, its highest since 2007. That was not the market pricing in higher central bank rates — it was the term premium returning, the extra yield investors want for locking money away for decades rather than rolling short bonds over and over. It rises when people get nervous about the far end of the picture, and the Congressional Budget Office has just lifted its annual deficit forecast to US$2.1 trillion, US$200 billion above February's.
The Treasury has already tried something. On 19 August it said it would at least double its buybacks of longer-dated debt, from US$2 billion an operation to a minimum of US$4 billion, running from 9 September to 4 November. Yields dropped on the news and drifted back up, which is the market appreciating the gesture without being convinced.
The tell whether these two soft sessions hold once the buybacks begin on 9 September. If the long end climbs back towards 5.3% with a bigger bid underneath it, the problem was never liquidity, and everyone goes back to arguing about the deficit. |
| HEALTHCARE |
Moderna has become the year's strangest stock, and a cancer vaccine did it
Moderna rose about 14% on Tuesday to close at US$159.14, a quiet day for a stock up roughly 392% this year. The move was a rebound rather than news: it had its best day on record on 19 August, gave a chunk straight back the next session as profit-takers moved in — more than US$18 billion of market value in a day — and has swung about ever since while investors argue over what it is worth.
What the trial showed. Moderna and Merck's intismeran autogene is a personalised vaccine: doctors sequence a patient's own tumour, then build a shot that trains the immune system to recognise that specific cancer. In a Phase 3 trial of 1,137 melanoma patients whose tumours had been surgically removed, the vaccine plus Merck's Keytruda beat Keytruda alone at a planned interim check, cutting recurrence and the spread of the disease. It is the first individualised therapy of its kind to work in a late-stage trial.
The argument is about everything after that. Wolfe Research has put potential peak sales at US$9.2 billion across four cancers — melanoma, kidney, bladder and lung — but three of the four are unproven, and building a bespoke vaccine per patient is a manufacturing problem nobody has solved at scale. Moderna also carried a heavy short position into the announcement, so plenty of the move has been bets being closed rather than opened.
The open question whether a treatment made one patient at a time can be produced fast and cheaply enough to reach the numbers those forecasts assume. The science looks settled enough. The factory does not. |
Newsworthy numbers
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| 89.4 The Conference Board's consumer confidence index for August, a seven-month low. Its six-month expectations gauge fell to 68.2, under the 80 mark the Board says tends to show up ahead of a recession. | | A$235 million What Coles set aside to repay staff it had underpaid, turning a $1.3 billion annual profit into a $1.1 billion one. |
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| 40 Companies that became unicorns in July, the most in over four years. Three arrived already valued above US$10 billion, which rather defeats the word. | | 8% of the speed of light How fast a newly spotted star called S301 laps the black hole at the centre of our galaxy, making it the fastest known star in the Milky Way. |
Worth a read
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| 01 | KiwiSaver withdrawals reach $260 million in July as hardship cases outnumber first home buyers — Nearly 9,800 people pulled money out early last month, more of them because they were in financial trouble than because they were buying a house. |
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| 02 | Coles FY26 profit climbs as liquor falters and job cuts loom — Supermarket sales did the heavy lifting, liquor did not, and the result arrived with a restructuring plan attached. |
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| 03 | Global bond yields are surging. Here's why it matters — A plain explainer on why long-dated government debt is repricing worldwide, and why it ends up in mortgage rates rather than staying put. |
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| 04 | Kimberly-Clark looks past trees for the future of paper products — Two decades screening 70-odd fibres, including seaweed and chicken feathers, for something other than wood to make tissues from. The winner is a spiky desert plant. |
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| 05 | The comfort and chaos of squishy toys — How stress-squeezing lumps of silicone became one of the fastest-growing corners of the toy industry, complete with collectors and resale markets. |
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| 06 | Buc-ee's fills up — The Texan petrol-station chain with a beaver mascot and stores the size of aircraft hangars is now in thirteen states. The economics are odder than the mascot. |
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| 07 | "One-in-a-million" sea creature fossil preserves soft tissue for 450 million years — Only two crinoid fossils have ever turned up with soft tissue intact, and this is the older one, found sitting in a small museum collection in Montreal. |
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| 08 | A record-breaking star could reveal how the Milky Way's giant black hole spins — The star passes close enough to Sagittarius A* to feel its rotation, which may let astronomers measure a black hole's spin from a single orbit. |
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| 09 | 2,200-year-old Roman shipwreck reveals ancient waterproofing secrets — Pine tar and beeswax, a blend Pliny the Elder wrote about, on a hull off the Croatian coast. Pollen in the coating shows where the ship was patched up along its route. |
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| 10 | This 18th-century British queen turned King Arthur into a P.R. strategy — A German-born queen needed her new dynasty to look British, so in 1735 she built a folly called Merlin's Cave and let the legend work. |
Wrapping up
July PCE, the inflation measure the Fed targets, lands Wednesday at 8.30am New York time — 12.30am Thursday in Auckland, 10.30pm Wednesday in Sydney — with the core rate expected up about 0.2% on the month and near 3.2% annually. Then on Friday, Kevin Warsh gives his first Jackson Hole keynote as Fed chair at 10am New York time, 2am Saturday here and midnight Friday in Australia. The symposium's theme is financial innovation and payments, though nobody is turning up for that.
Nvidia reports Wednesday after the New York close, about 9am Thursday our time, and the line that matters is the October-quarter guide rather than the quarter just gone. Intuit and Zoom reported after Tuesday's bell. Australia's July CPI indicator is out Wednesday at 11.30am AEST, with annual inflation at 3.8% to June and trimmed mean at 3.6%; the RBA is on hold at 4.35% until 29 September. New Zealand's diary is thin until the ANZ business outlook on 31 August, with the OCR at 2.25%.
The kiwi firmed to about 0.5977 US, or 1.6731 on the USD/NZD quote, and the Australian dollar rose to 0.7163, or 1.3961 on USD/AUD. Both gained on a softer greenback rather than anything local, since falling American yields narrow the gap that has been pulling money towards the US dollar.
Enjoy your Wednesday, and we'll be back in the morning.
General information and commentary only. This is not financial advice and does not take account of your objectives, financial situation or needs. It reflects the author's own reading of public information at the time of writing and may be wrong. Do your own research and speak to a licensed financial adviser before investing.