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The retail sector will take center stage this week, giving investors insight into how slowing spending and changes in consumer buying habits are affecting sales.

Walmart, the world’s largest retailer, is expected to report lower second-quarter profits tomorrow as it struggles to eliminate a buildup in inventory piled up amid changes in customer shopping habits. The retailer has seen an increase in low-margin food purchases with inflation near its highest level in four decades.

It could be a similar story for Target as it releases its sales and earnings outlook on Wednesday, following earlier warnings from the company that inflation was hurting consumer spending at its stores, driving down sales. profits for the whole year. As with Walmart, investors will be looking to see if Target has been able to reduce inventory levels and whether it needs to offer more discounts to offload excess inventory.

Tomorrow, Home Depot is expected to post an increase in second-quarter revenue amid continued demand for tools, paint and building supplies for professionals and homeowners. Lowe’s is also expected to post an uptick in second-quarter revenue on Wednesday, boosted by pent-up demand for patio furniture and grills after a cooler April impacted demand in the spring.

Other retailers reporting this week will include Tapestry, Kohl’s and Ross Stores, among others. The government will also report on retail sales data for July this week. Sales are expected to have risen at a slower pace of 0.1% in July, after rising 1% in June.

“Investors shunned big-box retailers until they emerged from the shadows whiplash effect this has caused them to be overstocked with inventory that consumers want, and not enough of what they make at the price they are willing to pay. This overhang could last for several quarters,” said Caleb Silver, editor of Investopedia.

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