The Buzz on Business for Monday, July 8th, 2024

It was more of the same over the 4^th of July holiday shortened week on Wall Street. 

The indexes were mixed but the S&P 500 and the NASDAQ Composite made new all-time highs on both Wednesday and Friday. 

The economic data was likewise, more of the same and likewise mixed as depending on your point of view, the labor market is clearly weakening but that is either a cause for concern or setting us up perfectly for a soft landing and a series of long-awaited rate cuts. The odds on such a cut coming at the Fed’s meeting at the end of this month shortened dramatically after the jobs report was released on Friday. 

The market internals continue to cloud the waters as well. Volume was way off, perhaps not unexpected during a holiday week. But the advance-decline line fell, as the broad market was making new high after new high. 

Throw in the fact that 2^nd quarter earnings season is set to begin, coming on the heels of stronger than expected 1^st quarter results, combined with Federal Reserve Board Chairman Jerome Powells scheduled testimony before Congress this week, along with a huge new dollop of political uncertainty and this market has plenty to think about and digest. 

And despite all this, stocks are either at or near highs for the year, if not at all-time highs. 

Stock Market Report 

The Dow was down Wednesday, up Friday. The Russell 2000 was up Wednesday, down Friday. The S&P and NASDAQ are both on a roll and posted good results on both days. 

• The Dow Jones Industrials finished the week at 39,376, down 24 points on Wednesday, up 68 points on Friday. 

• The S&P 500 finished the week at 5,567. It posted gains of 28 and 30 points on Wednesday and Friday respectively. Both days saw new all-time highs for the S&P. 

• Likewise, the NASDAQ Composite rallied and saw new all-time highs on both days. It starts the week at 18,353 after posting gains of 160 and 164 points. 

• Like the Dow, the small caps have been struggling. The Russell 2000 managed a three-point gain on Wednesday but posted a nine-point loss on Friday. It finished the week at 2,027. 

Bond Market Report 

Interest rates continued to fall last week. While both the 2 and 20-year paper were little changed after Wednesday’s abbreviated session, both saw sharply lower yields on Friday. 

• The yield on the 2-year treasury closed at its low of the week and now yields 4.608%, off eight basis points. 

• The 20-year starts the week at 4.582% off eight ticks for the week and four for the day on Friday. 

Oil, Gold, and Bitcoin 

• Oil continues to rally although it gave back $0.72 on Friday. It stands at $83.16. 

• Gold likewise had a strong week and stuck its nose above $2,400 before finishing Friday at 2,399.50, a new all-time high. 

• Not so much Bitcoin which has been in selloff mode of late. It was down over $2,000 on Wednesday and down over $3,000 more by the close of business on Friday when it stood at $56,542.60 

Mixed Econ News: Soft Landing or Trouble Ahead? 

The economic news was decidedly mixed all last week.  

On Wednesday, the ADP Nonfarm payroll report missed its mark, as did the initial and continuous jobless claims as all fell short of expectations. 

Friday saw the release of the Labor Department’s Jobs Report and it was, likewise, a mixed bag. 

The economy created 206,000 new jobs in June, more than the consensus estimate of 191,000. But a higher proportion of those jobs were working for governments as private nonfarm payrolls missed expectations by a wide margin. 

The unemployment rate ticked up again. It now stands at 4.10%, not awful but trending higher for the last three months. 

This week we get Retail Sales, a bunch of data out of the housing and constructions sectors and on Wednesday the Industrial Production numbers. 

If that’s not enough for you, earnings season gets underway on Thursday. 

It looks like a busy week for all of us here at the Ministry of Truth. Busy for us, but all you’ve got to do is keep it right here on the Buzz.