TheStreet’s Conway Mittens brings you the biggest news of the day, including what investors are watching and why credit card holders continue to pile up debt.
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00:00I'm Conway Gittins reporting from the New York Stock Exchange.
00:03Here's what we're watching on the street today.
00:05There's a mixed vibe on Wall Street
00:07this Thursday as a rally in AI-related stocks
00:10take a pause.
00:11On the earnings front, American Airlines
00:13is bucking the trend of good news from the airline sector.
00:16Fourth quarter results came in better than expected,
00:19but the company warned this quarter
00:21will be a money-losing one.
00:23American Airlines is struggling to fix a frayed relationship
00:27with its corporate clients.
00:29Turning to other business headlines,
00:31the mighty American US consumer is showing
00:34signs of credit card strain.
00:37The number of credit card borrowers
00:38who are only making their minimum monthly payments
00:41jumped to 10.75% in the third quarter,
00:44according to a report released by the Philadelphia Federal
00:47Reserve.
00:48That number hasn't been that high in over a decade.
00:52Delinquency rates are also on the rise.
00:55The number of credit card accounts
00:56that had a late payment of more than 30 days
00:59jumped to 3.5%, which is double the low seen
01:03when pandemic-era stimulus checks helped consumers
01:06shore up their balance sheets.
01:07While the rise in late payments is noticeable,
01:10it is nowhere near what we saw during the financial crisis
01:13when the late payment rate peaked at 6.8%.
01:17The report serves as a reminder that even though the overall
01:20economy remains healthy, the job market is steady,
01:23and the annual average wage gain is outpacing inflation,
01:28there are pockets of consumers who are still struggling.
01:32Food is expensive, rent is expensive,
01:34and since the Fed pushed interest rates from near zero
01:37to a peak of 5.25% to 5.5%,
01:40charging anything on a credit card is more expensive.
01:43There was some relief in 2024 when the Fed lowered
01:47its key lending rate by a full percentage point,
01:50but there's uncertainty about how much lower
01:52interest rates will go in 2025.
01:56That'll do it for your daily briefing
01:58from the New York Stock Exchange.
01:59I'm Conway Gittens with The Street.