Weekly Stock Market Update & SPY Technical Analysis This week, all eyes will be on labor market data, particularly Friday's U.S. unemployment report. Last month’s surprising spike in jobless claims rattled markets, sparking a wave of selling and raising concerns about a potential slowdown in consumer spending. The U.S. unemployment rate is expected to ease slightly from 4.3% to 4.2%, which could help calm fears of an impending recession. Beyond the labor market, investors will also focus on the U.S. trade deficit report to assess trends in exports and imports. The trade deficit narrowed last month, driven by increases in exports of civilian aircraft, automotive vehicles, and energy commodities. Imports rose by 0.6% to $339 billion, leaving the trade gap...
Stocks rocked back and forth on Friday after Powell finished his long awaited speech at the Economic Symposium. He started out his speech by stating that the “time has come” for policy change. He celebrated the progress that the central bank has made over the past three years, announcing the defeat on inflation. Powell’s tone seemed upbeat, more positive than meeting in recent history. His comments, combined with The FOMC Minutes released earlier last week, were reassuring that an interest rate cut is coming in September. Small caps reacted positively to the update, with the Russell 2000 (IWM) soaring 3% to end the day. Large tech stocks didn’t see as much of a reaction however, likely because markets are anxiously...
Weekly Market Update & SPY Technical Analysis Markets posted their best week of the year last week after new economic data helped relieve recession fears and restored confidence that a rate cut is coming in September. Earlier this month, markets saw what some would describe as a “flash crash,” which wiped billions from many companies’ market valuations, but buyers have actively bought the dip since. Last week’s CPI data brought more confidence to those buyers after the inflation number came in better than expected. CPI inflation reflected a reading of 2.9%, the first time below 3% since 2021, bringing it closer to The Fed’s 2% target. This accomplishment brings The Fed closer to loosening their monetary policy and lowering interest...
Weekly Stock Market Update & SPY Technical Analysis Markets experienced their highest level of volatility in years last week after fears of a recession resurfaced. Although volatility eased as the week progressed, nerves remain high about what could happen this week. The focus now turns to inflation data, which will be critical to watch. With recession fears on the rise, markets are hoping the Fed steps in and follows through on its September rate cuts. However, that won't be possible if inflation exceeds expectations. The Consumer Price Index (CPI), which measures inflation, is expected to reflect a reading of 3% year over year, unchanged from last month's reading but still on the right track of gradual improvement. The retail sector...
Weekly Stock Market Update & SPY Technical Analysis It is estimated that nearly $3 trillion in value was erased from the stock market last week. While most headlines blame the latest unemployment reading, in reality, it was a combination of events that led to the sell-off. First, let’s start with earnings. The Magnificent Seven group of mega-caps—Apple, Microsoft, Google, Amazon, Nvidia, Meta, and Tesla—has been the backbone of the market rally this year, making their earnings extremely critical to markets. Although most of them met forecasts, their earnings weren’t strong enough to justify their valuations. Excitement around artificial intelligence boosted outlooks exponentially in the past six months, but investors faced a reality shock after this round of earnings, suggesting that...
