The week’s trading on Wall Street was marked by gains, particularly in the tech sector. The Dow Jones Industrial Average saw a slight increase, while the S&P 500 and Nasdaq reached record highs by the end of the week. This trend continued the positive momentum seen in the previous month, quarter, and first half of 2024.
The standout performer for the week was the S&P 500 technology sector, with stocks like Apple and Broadcom leading the way. Consumer discretionary and communication services also showed strength, with companies like Meta Platforms and Alphabet performing well. On the other hand, energy stocks experienced a decline, along with health care and industrials.
During the week, there were notable updates on the economy, including the release of the government’s monthly jobs report. The unemployment rate for June rose slightly to 4.1%, with nonfarm payrolls additions coming in modestly higher than expected. The wage inflation remained in line with expectations. These numbers supported the case for the Federal Reserve to consider cutting interest rates at its upcoming meeting.
A significant development during the week was the release of Constellation Brands’ quarterly results. While the initial reaction to the news was positive, highlighting modest gains, it was evident that the wine and spirits business remained a concern for the company. The stock saw a slight dip mid-week but managed to recover towards the end, resulting in a relatively flat week for Constellation.
Updates on the manufacturing sector revealed weaker-than-expected numbers for June’s ISM Manufacturing purchasing managers index. Additionally, May’s factory order numbers showed a decline instead of the expected increase, signaling challenges in the manufacturing industry. The services PMI for June also disappointed economists, indicating a contraction in the services sector.
As the week came to a close, attention shifted towards upcoming key data releases, including the June consumer price index (CPI) and producer price index (PPI). The focus on these figures is crucial for gauging inflation levels and their impact on consumer prices and corporate margins.
Looking ahead, the earnings season is set to commence, with big money center banks like Wells Fargo preparing to report their quarterly results. Investors are keen on monitoring net interest income guidance and other key indicators that could influence market sentiment. The stress test results of major banking institutions like Wells Fargo and Morgan Stanley will also play a role in shaping investor confidence moving forward.
As market participants brace themselves for another round of earnings reports and economic data releases, the overall sentiment remains cautiously optimistic. The Federal Reserve’s potential interest rate cuts and ongoing trade tensions present uncertainties that could impact market dynamics in the coming weeks. It is essential for investors to stay informed and adapt to changing market conditions to make informed decisions regarding their investment strategies.