Stocks posted solid gains last week, buoyed by robust economic data and constructive comments from Fed officials.
The Standard & Poor’s 500 Index rose 3.93 percent, while the Nasdaq Composite gained 5.29 percent. The Dow Jones Industrial Average lagged a bit, picking up 2.94 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, powered ahead by 4.31 percent.1,2
Upbeat Economic News
Three critical economic data points gave investors what they were looking for: wholesale inflation, consumer prices, and retail sales.
Both the Producer Price Index and the Consumer Price Index rose less than expected in July, reinforcing a picture of cooling inflation. The July retail sales report on Thursday was stronger than expected, which added more fuel to the week-long rally.3,4,5
Market action slowed down on the week’s final trading day, with positive consumer sentiment gains countered only by a drop in housing starts.
It was the S&P 500’s best weekly gain of the year so far and the best since November of 2023. The gains helped erase losses from earlier in the month, when “carry trades” news from Japan unsettled investors.6,7
Double Assist
Last week’s market rally saw assists from two places: economic data and constructive Fed comments.
On Thursday, Atlanta Fed President Raphael Bostic said he had “a lot more confidence that inflation’s sustainably on its way to 2%,” citing steady drops in CPI. And St. Louis Fed President Alberto Musalem said, “the time may be nearing when an adjustment (to the Fed Funds Rate) may be appropriate.8
This Week: Key Economic Data
Monday: Leading Indicators.
Wednesday: FOMC Meeting Minutes.
Thursday: Jackson Hole Economic Symposium. Jobless Claims. Existing Home Sales.
Friday: Jackson Hole Economic Symposium. New Home Sales. Fed Chair Jerome Powell speaks.
Source: Investors Business Daily – Econoday economic calendar; August 16, 2024
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
This Week: Companies Reporting Earnings
Monday: Palo Alto Networks, Inc. (PANW)
Tuesday: Lowe’s Companies, Inc. (LOW)
Wednesday: The TJX Companies, Inc. (TJX), Analog Devices, Inc. (ADI)
Thursday: Intuit Inc. (INTU)
Source: Zacks, August 16, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
Source: YCharts.com, August 17, 2024. Weekly performance is measured from Monday, August 12, to Friday, August 16. TR = total return for the index, which includes any dividends as well as any other cash distributions during the period. Treasury note yield is expressed in basis points.