By Liz Moyer

Investing.com — Stocks recovered from their early losses and rallied Tuesday, in spite of a warning by Target That shook the retail sector.

Like other retailers, Target Corporation (NYSE:) is experiencing changing consumer habits as spending shifts from the discretionary items that were popular during the pandemic stay-at-home period to experiences and travel now that things have reopened, not to mention consumers are prioritizing amid higher prices for basics such as food and fuel.

Next week, the Federal Reserve will meet to determine what next steps to take regarding interest rates. There are expectations of a half point increase in inflation control. Janet Yellen from the Treasury Department told Tuesday’s Senate Finance Committee that inflation is likely to continue at a high level. Yellen will again testify before the House on Wednesday.

The retail sector’s softening could signal a slowdown. But not every retailer faced the same problems in the last quarter. As social and business activity increases, retailers with higher spending customers report strong trends in apparel and accessories sales.

Novavax Inc shares (NASDAQ:) should rise once the trading stop is lifted. After reviewing safety and effectiveness data, the advisory panel of Food and Drug Administration recommended that the Covid-19 vaccine be used for adults aged 18 and older.

Three things could impact the markets in tomorrow’s future:

1. Earnings from Brown Forman

Brown Forman, the spirit maker and owner of Jack Daniels as well as Finlandia brands, reports earnings on Wednesday. On revenue of $832million, analysts expect 27c per share earnings.

2. Campbell Soup

Campbell Soup Company (NYSE) will report an EPS of 61c for just more than $2 billion in earnings. Analysts will listen to executives’ comments about supply chains.

3. Yellen testimony

Janet Yellen, Treasury Secretary will be testifying about the federal fiscal budget for 2023 at the House Ways and Means Committee meeting Wednesday morning at 10:00 ET. Yellen already admitted in the Senate that persistently high inflation was “unacceptable”.