Equity markets were steady on Monday as traders waited on key reports from the retail sector. The July reading of Retail is due today, along with reports from Home Depot and other major retailers. Walmart and Target are also expected to report this week and will indicate what to expect from the consumer in Q3 and Q4. The story so far is that shifting consumer habits are cutting into discretionary spending, but rising inflation continues to sustain solid spending.

The next major hurdle for the market comes on Wednesday when the FOMC releases the minutes from their last meeting. The committee is not expected to indicate a rate hike at the next meeting, but inflation trends suggest the rhetoric will be hawkish. The question is if the market will heed the warning, if any, that additional hikes are coming. As it is, the market is pricing in a low expectation for another hike in 2023.