All three major U.S. indexes ended the week with gains, after a whirlwind of Big Tech earnings, economic data and central bank announcements bolstered investor confidence in a sharp drop. soft wing for the US economy.
Data showed on Friday that annual inflation in the United States slowed significantly in June, potentially bringing the Federal Reserve near the end of its fastest rate hike cycle since the 1980s.
In the 12 months to June, the PCE price index rose 3.0%. This is the smallest annual increase since March 2021 and follows a 3.8% increase in May.
Scott Ladner, chief investment officer at Horizon Investments, said: “You put it all together and you end up getting the idea that this Goldilocks economy can continue for a short while, with obvious inflation. will decrease”. The Dow Jones Industrial Average rose 176.37 points, or 0.5%, to 35,459.09, the S&P 500 gained 44.76 points, or 0.99%, to 4,582.17 and the Nasdaq Composite added 266 .55 points, or 1.9%, to 14,316.66. “People are more optimistic about the possibility of inflation being under control and the economy avoiding a recession,” said Win Murray, research director at wealth management firm Diamond Hill.
For the week, the Nasdaq is up 2.02%, while the S&P is up 1.01% and the Dow is up 0.66%. The gains helped the S&P 500 hit its highest close since April 4, 2022.
Volume on US exchanges was 10.10 billion shares, compared with an average of 10.45 billion for the full session over the past 20 trading days. On Wednesday, Federal Reserve Chairman Jerome Powell said the Fed does not anticipate a recession and does not rule out another rate hike, adding that it will monitor future economic data.
Ending the week with encouraging signs, more than half of the companies listed in the S&P 500 posted second-quarter results on Friday, 78.7% of which beat analysts’ expectations. , according to Refinitiv data.
Barclays said investors rushed to buy shares this week, with $10 billion in capital inflows into U.S.-listed stocks, according to a note to clients.
Most of the 11 major S&P 500 sectors were up, led by media services, up 2.3% as major tech companies maintained their bullish bias after reporting results earlier this week.
A trader works on the floor of the New York Stock Exchange in New York, U.S., July 26, 2023. REUTERS/Brendan McDermid/Profile photo
On the earnings front, Intel earnings and guidance suggest the PC market is improving, pushing the chipmaker’s stock up 6.60%.
Peers Nvidia and Marvell Technology also gained 1.85% and 1.60%, respectively.
The Dow Jones blue-chip index ended its longest streak of gains since 1987 on Thursday as US Treasury yields weighed on equities following news the Bank of Japan would allow rate hikes. long term.
The Bank of Japan has eased its yield curve control policy and eased its long-term cap protection, in moves seen by investors as a prelude to finally giving up. major monetary stimulus measures.
The US 10-year bond yield fell 4% in the previous session, leading to strong growth in technology stocks and hypercaps.
Procter & Gamble rose 2.83% after the consumer giant beat analysts’ estimates for quarterly revenue.
Ford Motor lost 3.42% after Chief Executive Officer Jim Farley announced a change in the automaker’s product strategy, slowing the rise of loss-making electric vehicles.
Enphase Energy fell 7.48% after the solar inverter maker’s third-quarter revenue forecast missed expectations, while Juniper Networks (JNPR.N) fell 6.94%, the network operator Q3 revenue forecast was lower than market estimates.
Exxon Mobil fell 1.19% after the oil giant posted a 56% drop in quarterly profit, while its counterpart Chevron lost 0.50% after its annual production forecast stayed near the bottom of its estimated range. before. Reata Pharmaceuticals jumped 54.02 percent after Biogen agreed to buy the rare disease maker for nearly $6.5 billion.
Issues rose more than issues fell on the NYSE by a ratio of 2.64 to 1; on Nasdaq, a ratio of 2.81 to 1 is favored.
The S&P 500 posted 27 new 52-week highs and two new lows; Nasdaq Composite recorded 83 new highs and 84 new lows.
