Stock Market Today: Dow Slips, Boeing Flies, and Nikola Soars
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The S&P 500 had its best month since November 2020 in July, gaining 9.1%.
Angela Weiss/AFP via Getty Images
Shares tumbled to kick off August trading on Monday after a strong July. Economic data is in the spotlight this week.
The
closed 46 points, or 0.1%, while the
slipped 0.3%, and the
down 0.2%. The S&P 500 rose more than 4% last week, its biggest weekly gain in more than a month.
The rally started long before last week. On Monday, the S&P 500 was up 14% from its intraday low of the year, reached in mid-June. The gains were boosted by hopes that the The Federal Reserve will soon slow the pace of interest rate hikes it unfolds to curb economic demand and bring inflation down.
“Markets are increasingly reflecting the belief that if a serious downturn begins to build, central banks will pivot and ease or even roll back their monetary tightening plans,” wrote Louis Navellier, founder of Navellier & Associates.
A better than expected earnings season also helped the market. While some companies have reduced their financial forecasts in light of the economic challenges, most exceed estimates and offer fairly good prospects. Overall earnings per share on the S&P 500 beat expectations by almost 5%, with nearly three-quarters of the index’s market capitalization returning, according to Credit Suisse.
Corporate earnings this week include the results of
ActivisionBlizzard
(ticker: ATVI) on Monday, before
BP
(PB),
caterpillar
(CAT),
Advanced micro-systems
(AMD),
PayPal
(PYPL),
Modern
(ARNM),
Conoco Phillips
(COP), and others in the coming days.
Earnings aside, the market will focus on economic data and its implications for monetary policy. The ISM Manufacturing Purchasing Managers’ Index in the United States slipped to 52.8 in July from 53 in June. Slower economic growth could mean slower inflation and less aggressive rate hikes.
Friday’s jobs report from the Bureau of Labor Statistics is expected to show the United States added 250,000 jobs in July, down from June’s result of 372,000. are hiring, they wouldn’t mind seeing the pace of job gains slow, as it could validate the thesis that the Fed will slow rate hikes.
“As demand slows and supply bottlenecks improve, we should expect a corresponding slowdown in inflation in the second half of this year,” wrote Jeffrey Roach, an economics economist. head for LPL Financial. “The Fed will likely respond with lower rate hikes in future meetings.
Here are some stocks in motion on Monday:
Ali Baba
(BABA) gained 1.1% after falling 11% last Friday. The Chinese tech giant said it would work to maintain its listings in New York and Hong Kong, after being added to a Securities and Exchange Commission list of Chinese companies that could be delisted if they failed to meet not meet audit requirements.
Boeing
(BA) increased by 6.1% after the aircraft manufacturer temporarily avoided a strike at three factories that make military equipment and U.S. regulators have approved the company’s plan to validate repairs to the 787.
Nicholas
(NKLA) rose 7.9% after the company announced that it will buy battery supplier Romeo Power for $144 million.
Global Payments
(GPN) gained 4.7% after the the company acquired EVO Payments (EVOP) for $4 billion.
Target
(TGT) rose 1.3% after being upgraded to Overweight from Equalweight at Wells Fargo.
Goldman Sachs’ Jeffrey Currie makes the case for energy while Moody’s Analytics’ Mark Zandi warns that oil prices are the biggest threat to the economy.
Write to Jack Denton at jack.denton@dowjones.com and Jacob Sonenshine at jacob.sonenshine@barrons.com
.
