Daily Dispatch: Wal-Mart, Mattel, Kmart, and Frontier

  • Wal-Mart reported a higher quarterly profit, but cut its outlook for the rest of the year, blaming inflated gas prices, rising mortgage defaults, and the housing funk for decreased consumer spending. Earlier this year, the retailer renewed its focus on low prices after unsuccessful efforts in apparel and home decor, but this approach has not yet turned into increased sales. The Commerce Department reported that U.S. retail sales rose more than forecast in July, and if the trend continues, it may help Wal-Mart rebound.
  • Mattel Inc. recalled 9 million more Chinese-made toys -- some with lead paint and some with magnets that children can swallow -- in two separate recalls after discovering the faulty products during its China-vendor investigation. The toy maker, already known for its commitment to safety, is also engaging in an aggressive campaign to advise consumers of the recall, placing full-page ads in major newspapers and announcing an even-more-thorough safety process, which includes checking every batch of paint used in its toys for lead.