THE WEEK ON WALL STREET Overcoming jitters about the Delta variant and the reintroduction of mask requirements, stocks climbed higher on strong employment data and a fresh batch of strong corporate earnings. The Dow Jones Industrial Average rose 0.78% while the Standard & Poor’s 500 advanced 0.94%. The Nasdaq Composite index gained 1.11% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, picked up 1.61%. The crosscurrents of strong corporate profits and the rise in Delta variant infections led to a roller coaster week of price action, as markets alternated between daily gains and losses. By Thursday, however, investors appeared to grow more optimistic that the economic reopening was not under serious threat when back-to-back employment reports suggested that the economic recovery remained on track. A favorable initial jobless claims report was enough to send the S&P 500 and Nasdaq to new all-time highs. Thanks to Friday’s stronger-than-expected employment report, the S&P 500 managed to add to its previous record close, while the Dow Jones Industrial Average set its own record high. The more tech-centric Nasdaq, however, slipped off its highs. Last week reinforced the idea of an improving labor market. After a disappointing ADP (Automated Data Processing) National Employment Report that showed a slowdown in private-sector hiring, with just 330,000 new jobs added, subsequent employment data were much more encouraging. Thursday’s report of a modest drop in initial jobless claims to 385,000 and a more substantial drop of 366,000 in continuing claims was followed by a solid employment report on Friday, which showed employers had added 943,000 new jobs in July—the biggest jump since August 2020. This hiring increase shaved the unemployment rate to 5.4%, down from June’s 5.9% rate. The "extra" unemployment benefits are set to sunset in September. I hope those who are hanging onto the extra free money rather than getting back to work aren't in for a rude awakening when there's a mad dash to get a real job next month. It is sad when Burger King is offering a $1,000 sign on bonus. Thank big government for that. Monday: JOLTS (Job Openings and Labor Turnover Survey). Wednesday: Consumer Price Index. Thursday: Jobless Claims. Friday: Consumer Sentiment. Monday: Air Products and Chemicals, Inc. (APD), Tyson Foods, Inc. (TSN). Tuesday: Sysco Corporation (SYY), Coinbase Global, Inc. (COIN). Wednesday: Nio, Inc. (NIO), eBay, Inc. (EBAY). Thursday: The Walt Disney Company (DIS), Baidu, Inc. (BIDU), Doordash, Inc. DASH), Airbnb, Inc. (ABNB). peaking this week or next and may have peaked in Florida last week. This is based on the forecast of data scientists using math and not fear. There are lots of earnings reports continuing to come out. A few of the epicenter type companies like Disney and Airbnb are reporting this week and it will be interesting to hear what they have to say. Stay tuned… |
THIS WEEK'S UPDATE
