PAS Weekly Commentary

Growth Concerns Dissipate, Fueling Strong Rally

The stock market logged solid gains since last Friday.

The Dow Jones Industrial Average and Russell 2000 each closed 2.9% higher, the S&P 500 jumped 3.9%, and the Nasdaq Composite climbed 5.3%.

The volatile action exhibited thus far in August was precipitated by a July jobs report that stirred concerns about a weakening economic environment and labor market. So, this week's release of economic data that had the market feeling good about the economic environment and labor market invited strong buying activity.

The pleasing economic releases included the Producer Price Index for July, which showed disinflation in total and core PPI, the Consumer Price Index for July, which was in-line with expectations, the Retail Sales report for July, which was much better than expected, and the weekly jobless claim report, which reflected ongoing strength in the labor market.

A disappointing housing starts and building permits report for July on Friday didn't deter the strong rally this week.

Solid earnings results and commentary about the consumer from Walmart (WMT), along with Cisco's (CSCO) solid fiscal Q4 operating performance, contributed to the upside bias this week.

In other corporate news, Dow component Home Depot (HD) closed 3.9% higher this week despite reporting below-consensus guidance.

Starbucks (SBUX) was in the headlines after news that CEO Laxman Narasimhan has stepped down and will be replaced by Chipotle (CMG) CEO Brian Niccol.

Kellanova (K) also made news after Mars confirmed it will acquire Kellanova for $83.50/share in cash, or total consideration of $35.9 billion, including debt.

Alphabet (GOOG) settled slightly lower in the week despite other mega caps outperforming after a Bloomberg report that the Department of Justice may be looking at breaking up the company following last week's court ruling that Alphabet violated search-related antitrust laws.

All 11 S&P 500 sectors closed higher led by consumer discretionary (+5.2%), information technology (+7.5%), and financials (+3.2%).

  • Nasdaq Composite:+17.5% YTD
  • S&P 500: +16.5% YTD
  • S&P Midcap 400: +8.3% YTD
  • Dow Jones Industrial Average: +7.9% YTD
  • Russell 2000: +5.7% YTD

To download the printable version, CLICK HERE.

Past performance is not a guarantee of future results. Indices are unmanaged and one cannot invest directly in an index. Diversification does not guarantee investment returns and does not eliminate the risk of loss.

Data and rates used were indicative of market conditions as of the date shown and compiled by Briefing.com. Opinions, estimates, forecasts, and statements of financial market trends are based on current market conditions and are subject to change without notice. References to specific securities, asset classes and financial markets are for illustrative purposes only and do not constitute a solicitation, offer, or recommendation to purchase or sell a security. S&P 500 Index is a market index generally considered representative of the stock market as a whole. The index focuses on the large-cap segment of the U.S. equities market. Each company’s security affects the index in proportion to its market value. NASDAQ Composite Index is a market value-weighted index that measures all NASDAQ domestic and non-U.S. based common stocks listed on the NASDAQ stock market. Dow Jones Industrial Average is a widely used indicator of the overall condition of the stock market, a price-weighted average of 30 actively traded blue chip stocks, primarily industrials, but also includes financial, leisure and other service-oriented firms. Russell 2000 Index measures the performance of the smallest 2,000 companies in the Russell 3000 Index of the 3,000 largest U.S. companies in terms of market capitalization. MSCI Emerging Markets Index is a free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets.

Park Avenue Securities LLC (PAS) is a wholly owned subsidiary of The Guardian Life Insurance Company of America (Guardian). PAS is a registered broker/dealer offering competitive investment products, as well as a registered investment advisor offering financial planning and investment advisory services. PAS is a member of FINRA and SIPC.

Provided by Briefing.com.

2024-180040 (Exp. 11/24)

Top