The major averages all rallied for another winning week, capping off the best month for equities in 2022. It was also a week that perfectly illustrated why it is often the expectations that matter far more than the actual reported numbers. On the macro front, in addition to a 75 basis point rate hike from the Federal Reserve on Wednesday, we secured the lead on the second quarter gross domestic price index which indicated the second consecutive quarter of economic contraction. . Historically, two consecutive GDP contractions would indicate an economic recession. However, historically, you also don’t see a 3.6% unemployment rate during a recession. Call it what you want, but the one thing that’s clear is that the economy is slowing down. Then, on the earnings front, we heard the names of the mega-caps responsible for more than 20% of the S&P 500 market valuation. exception of Meta Platforms) managed to react positively. So, undoubtedly worrying economic data combined with mixed earnings releases. Still, we managed to rebound with the Dow Jones gaining almost 3% on the week, the S&P 500 advancing 4.2% on the week and the Nasdaq jumping 4.7%. In our view, this ability of the market to ignore these weakened economic conditions and the mixed results of the results of the main stock market indicators is a sign that investors have been expecting these updates and may have finally priced in the economic reality. to market, providing the necessary ingredients to put in a short-term bottom. While that doesn’t mean we’re shooting higher in a straight line, it does give reason for more optimism as we go forward and some leeway to allow the economic picture to develop further. Before we continue, one final note on the hotter than expected inflationary reading. Although it was above expectations, it is important to remember that these readings are retrospective (it was a June reading and we are now at the end of July). As a result, investors may not value the release as much given that the Federal Reserve raised rates this week by 75 basis points. This commentary on quarterly earnings from management teams that we received this week trumps outdated data. Under the hood this week, all S&P sectors closed higher, with energy leading the gain, followed by utilities and industrials. Meanwhile, the US Dollar Index remained steady around the 106 level. Gold sits at around $1,760 an ounce. WTI crude prices remain at just under $100 a barrel. The 10-year Treasury yield returned to the level of 2.65%. Retrospective We received results from Microsoft (MSFT), Alphabet (GOOGL), Humana (HUM), Meta Platforms (META), Qualcomm (QCOM), Ford (F), Linde (LIN), Honeywell (HON), Apple ( AAPL), Amazon (AMZN), Chevron (CVX), AbbVie (ABBV) and Procter & Gamble (PG). On the macroeconomic front: On Tuesday, sales of new homes would have fallen by 8% in June and by 17% annually. Then on Wednesday, pending home sales reportedly fell 8.6% in June and 20% annually, estimates missing. Also on Wednesday, the Federal Reserve raised interest rates by 75 basis points. On Thursday, we got the advance reading of second-quarter GDP, which showed a contraction of 0.9%, missing expectations of a 0.3% expansion. Also on Thursday, initial jobless claims for the week ended July 23 came in at 256,000, missing expectations of 250,000. Finally, on Friday, we received the June personal spending report, which showed a year-on-year increase of 4.8% in the core PCE price index (the Fed’s preferred measure of inflation), slightly above the 4.7% expected. What to expect Within the portfolio, we will hear from Devon Energy (DVN) on Monday after the close; Advanced Micro Devices (AMD) and Coterra Energy on Tuesday after the bell; and Eli Lilly (LLY) Thursday before the opening bell. Here are some other earnings reports and economic numbers to watch in the week ahead: Monday August 1 Before the Bell: Builders FirstSource (BLDR), Jacobs Engineering (J), Global Payments (GPN), ON Semi (ON), JELD – WEN (JELD), Aerojet Rocketdyne (AJRD), Affiliated Managers (AMG), Check Point Software (CHKP) After the bell: Mosaic (MOS), Aflac (AFL), CF Industries (CF), Avis Budget (CAR), Univar Solutions (UNVR), DaVita (DVA), Diamondback Energy (FANG), Williams Cos (WMB), Sanmina (SANM), Activision Blizzard (ATVI), Leggett & Platt (LEG), Simon Property (SPG), Arista Networks ( ANET ), Pinterest (PINS), Vornado Rlty (VNO) 10:00 a.m. EST: ISM manufacturing PMI Tuesday August 2 Before the bell: Marathon Petrol (MPC), Caterpillar (CAT), Uber (UBER), Cummins (CMI), Eaton (ETN), Lear (LEA), Marriott (MAR), Illinois Tool (ITW), Leidos (LDOS), DuPont (DD), Henry Schein (HSIC), S&P Global (SPGI), Molson Coors (TAP), JetBlue (JBLU), Arconic (ARNC), KKR (KKR), Ferrari (RA CE), IDEXX Labs (IDXX), Pour wer Semi (TSEM) After the Bell: Prudential (PRU), Occidental Petro (OXY), Starbucks (SBUX), PayPal (PYPL), Gilead (GILD), Caesars Ent (CZR) , AirBnB (ABNB), GXO Logi (GXO), Electronic Arts (EA), Cirrus Logic (CRUS), SoFi (SOFI), Alteryx (AYX) Wednesday, August 3 Before the bell: CVS (CVS), AmerisourceBergen (ABC), Enterprise Products (EPD), CDW (CDW), Sunoco (SUN), Trane (TT), Exelon (EXC), Moderna (MRNA), Berry Global (BERY), BorgWarner (BWA), Regeneron (REGN), Yum! Brands (YUM), Under Armor (UAA), Vertiv (VRT), Spirit Aero (SPR), Generac (GNRC), Brinks (BCO), Horizon Pharma (HZNP) After the bell: McKesson (MCK), Energy Transfer (ET ), MetLife (MET), Nutrien (NTR), Plains All American (PAA), Allstate (GER), Lumen Tech (LUMN), Lincoln National (LNC), Booking Holdings (BKNG), DXC Tech (DXC), MGM ( MGM), MercadoLibre (MELI), Altice (ATUS), eBay (EBAY), Marathon Oil (MRO), Clorox (CLX), Sprouts Farmers (SFM), Albermarle (ALB), Ingersoll-Rand (IR), Qorvo (QRVO ), Realty Income (O), 10:00 a.m. EST: Factory Orders 10:00 a.m. EST: ISM Services PMI Thursday, August 4 Before the bell: Alibaba (BABA), Cigna (CI), ConocoPhillips (COP), Arrow Electric ( ARW), CBRE Group (CBRE), Paramount Global (PARA), Johnson Controls (JCI), WestRock (WRK), NRG Energy (NRG), Duke Energy (DUK), Becton Dickinson (BDX), Aptiv (APTV), Parker -Hannifin (PH), Kellogg (K), Wayfair (W), Air Products (APD), Zoetis (ZTS), PerkinElmer (PKI), Crocs (CROX), AZEK (AZEK), Datadog (DDOG), Shake Shak k (SHAK) After the bell: Suncor Energy (SU), Warner Bros Discovery (WBD), Amgen (AMGN), Corteva (CTVA), EOG Resources, Block (SQ), Opendoor Tech (OPEN), Carvana (CVNA) , Live Nation (LYV), XPO Logi (XPO), Con Edison (ED), AES (AES), Motorola Solutions (MSI), Rocket Companies (RKT), DoorDash (DASH), Skyworks (SWKS), Lyft (LYFT) , Twilio (TWLO), Dropbox (DBX), Universal Display (OLED) 8:30 a.m. EST: Initial jobless claims Friday, August 5 Before the bell: Goodyear Tire (GT), Western Digital (WDC), Telus (TU), Flour (FLR), Adient (ADNT), Wabtec (WAB), DraftKings (DKNG), Canopy Growth (CGC), Twist Bio (TWST) 8:30 a.m. EST: Non-Farm Payroll (See here for a full list of Jim Cramer’s actions Charitable Trust.) As a CNBC Investing Club subscriber with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, AS WELL AS OUR DISCLAIMER. NO OBLIGATION OR FIDUCIARY DUTY EXISTS, OR IS CREATED BY YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED.
The logos of Amazon, Apple, Facebook and Google.
Reuters
The major averages all rallied for another winning week, capping off the best month for equities in 2022. It was also a week that perfectly illustrated why it is often the expectations that matter far more than the actual reported numbers.
.
Tags: AbbVie Inc, Advanced Micro Devices Inc., Alphabetical class A, Amazon.com Inc., Apple Inc., Breaking News: The Markets, Chevron Corporation, COMEX Gold (August 22), Coterra Energy Inc, Danaher Corp., Devon Energy Corporation, Dollar Index Futures Contract (September 22), economic news, Eli Lilly and Co., Ford Motor Co., Halliburton Co., Honeywell International Inc., Humana inc., Investment strategy, Jim Cramer, Johnson & Johnson, Linde PLC, Markets, Meta Platforms Inc., Microsoft Corp., Procter & Gamble Co., Qualcomm Inc., Salesforce Inc., WTI Crude (Sep 22)
