COVID-19 RESURGENCE CRIMPS SPENDING, TRAVEL RECOVERY

A COVID-19 resurgence this summer has caused consumers to turn cautious, while investors trim their investments in a travel sector still struggling to recover.

Retail sales dipped a surprising 1.1% in July as consumers spent less on clothing, furniture and sporting goods. At the same time investors have been retreating from cruise lines, airlines and other travel-related stocks as those companies face another potential stall inactivity as cases of COVID-19 surged because of the highly contagious delta variant.

The pullback in spending and investments in the travel sector mark an unwelcome reversal from growth through much of the year. Vaccinations seemed to be knocking down the virus, giving people more freedom to shop at stores, eat out and plan trips after more than a year of hunkering down at home.

“Clearly as we learned over the course of the last 18 months this thing takes twists and turns that are undefinable,” said Mike Stritch, chief investment officer of BMO Wealth Management.