It’s getting harder for markets to ignore the weakening US consumer

A growing number of firms are signaling a weaker outlook for US consumer spending, putting a
key pillar
of economic support in focus for investors this year.

Disappointing outlooks from a range of companies show expectations for strong consumer spending have ebbed after years of US shoppers helping to prop up the post-pandemic economy.

Airlines and retailers are the latest casualties of mounting calls for a weaker consumer as Wall Street
positions for a possible economic slowdown
.

Delta, Southwest, and Jet Blue each cited macroeconomic uncertainty as a leading reason for
lowered earnings forecasts
this week. A weaker outlook for travel demand has slashed first-quarter revenue expectations. Delta fell as much as 8.7% Tuesday morning.

Losses, though, have been even heavier among big-box retailers that are seeing a similar slowdown in consumer spending.

Kohl’s
sank 23% by around midday on Tuesday. For the full year, the retailer
expects
net sales to drop 5%-7%. Earnings per share are forecast between $0.10-$0.60, well below consensus estimates.

Meanwhile, disappointing earnings projections from Dick’s pushed the athletic retailer’s stock down almost 6% in Tuesday’s session.

Both are just the latest examples in a string of downbeat consumer signals. Last month, retail stocks were rocked by Walmart’s
underwhelming fiscal year outlook
, suggesting a looming spending unwind.

The notion of a spending pullback has ripped into the stock market over recent weeks, adding to economic pressures that have pushed the benchmark
S&P 500 index
to drop 9.4% from a February high.

Monday marked the index’s most painful day this year — among notable losers were stocks exposed to consumer lending, such American Express, Capital One, and Discover.

While Americans’ buying spree has been a source of economic and market strength since 2022, consumer endurance is petering out: stubborn inflation, high interest rates, and the threat of tariffs are pushing spenders into a cost-saving mentality.

Even before this year’s economic uncertainty caused
recessionary fears
to spike, consumers were already signaling lower
spending intentions
in the first quarter.

Month-to-month sales fell 0.22% in February, excluding automobiles and gasoline, according to the
CNBC/NRF Retail Monitor
.

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