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S&P 500, Nasdaq gain to kick off a huge week for markets
U.S. stocks gained after briefly turning negative on Monday to kick off a big full week with a Federal Reserve rate decision, the jobs report and Big Tech earnings.
The Dow Jones Industrial Average (^IXIC) recovered earlier losses and hovered near the flat line, coming out of a increase of more than 650 points for the blue-chip index on Friday. The S&P 500 (^GSPC) gained 0.4%, while the tech-heavy Nasdaq Composite (^IXIC) rose 0.6%.
Stocks started the week on the right foot after rising on Friday, with investors welcoming a promising inflation reading that solidified bets on rate cuts. But after a volatile stretch of sessions and a big sell-off in technology, the clock is open for surprises that could put the fragile rally to the test.
No action is expected from the Federal Reserve at the end of its meeting on Wednesday, despite signs that the U.S. economy and inflation have reached a sweet spot. Many in Wall Street sees other reasons for the central bank to wait until September to act.
Read more: 32 Charts That Tell the Story of Markets and the Economy Right Now
The July nonfarm payrolls report due out on Friday — which is expected to show cracks in the labor market — will influence later calculations on the timing and depth of rate cuts in 2024.
Apple’s looming earnings this week (AAPL), Microsoft (MSFT), Amazonas (AMZN) and Meta (GOAL) also put investors on alert, given the elimination of actions that followed the first pair of results from the “Magnificent Seven”.
While they wait, investors will be treated to a barrage of quarterly results from more than 150 members of the S&P 500. McDonald’s (MCD) earnings failed in every aspect before the market closed on Monday as consumers cut back on spending.
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- Mon, 29 Jul 2024 7:39pm GMT+2
Trending tickers Monday
McDonalds (MCD)
McDonald’s shares rose more than 4% on Monday despite the company’s second-quarter profits fell short as customers stopped dining out.
“Consumers are more judicious with their spending,” CEO Chris Kempczinski said in the earnings release.
ON Semiconductors (ABOUT)
The chip company reported second-quarter earnings beat analysts’ estimates and its third-quarter guidance is in line with Wall Street expectations.
ON Semiconductor rose more than 12% during Monday’s session.
Bitcoin (BTC-USD)
The cryptocurrency surged above $69,000 before paring gains on Monday after Republican presidential candidate Donald Trumppoke a bitcoin conference in Nashville on the weekend.
Trump has promised pro-crypto initiatives, including the establishment of a “strategic national stockpile of bitcoin.”
Investors are betting the Fed will use its July meeting to set the stage for a September rate cut
Jennifer Schonberger of Yahoo Finance reports:
Most Federal Reserve watchers don’t expect the central bank to ease monetary policy this week in Washington DC, but what they do expect is that policymakers set the stage for an interest rate cut at the next meeting in September.
Fed officials said they are getting closer to having confidence inflation is falling sustainably to its 2% target. They also said they are paying closer attention to rising unemployment, another sign that cuts may be coming.
But most Fed watchers say the central bank still needs a bit more time to be certain, while also preparing markets for the significant actions to come.
“The pressure is building for them,” said former Kansas City Fed President Esther George. “I think they’re going to look at September very seriously. It seems to me that we’re getting to a point where that decision is more important and that’s why I’m more confident.”
To read more here.
S&P 500 and Nasdaq return to green territory
Stocks rose on Monday after briefly turning negative during the session.
The Dow Jones Industrial Average (^DJI) was little changed after falling more than 100 points in morning trading.
The S&P 500 (^GSPC) gained 0.2%, while the Nasdaq Composite (^IXIC) returned to green territory to rise 0.2% after briefly turning negative.
Starbucks expected to report weak sales as it boosts popped pearls and value plays
Brooke DiPalma of Yahoo Finance reports:
Starbucks (SBUX) investors are cautious ahead of Tuesday’s earnings report.
Its shares are down nearly 28% compared to last year as the coffee giant painted a picture of a resilient consumer With a 10% growth in sales, different expectations are now on the agenda.
Q3 revenue is expected to rise 0.37% to $9.20 billion, according to Bloomberg consensus estimates. Adjusted earnings per share are expected to be 92 cents, compared with $1.00 a year ago.
To read more here.
Stocks erase session gains, Nasdaq turns negative
Stocks erased gains from the previous session and fell below the flat line on Monday.
The Dow Jones Industrial Average (^DJI) lost about 100 points after initially opening higher. The S&P 500 (^GSPC) fell 0.1%, while the Nasdaq Composite (^IXIC) also fell below the flat line after gaining as much as 0.9%.
Bitcoin hovers near $69,000 after Trump’s pro-crypto speech
Bitcoin (BTC-USD) was trading near the $69,000 per token level on Monday after former President Donald Trump promoted a pro-crypto agenda at a bitcoin conference over the weekend.
Trump was the keynote speaker at Bitcoin 2024 on Saturday in Nashville, Tennessee. The Republican presidential candidate said he plans to make the U.S. the “cryptocurrency capital of the world” if elected in November. He also proposed creating a “national bitcoin stockpile.”
To read more here.
McDonald’s shares rise despite lower-than-expected second-quarter profit as consumers reduce dining-out options
McDonalds (MCD) shares rose Monday morning, recovering from an initial negative reaction at the market’s opening following the fast-food chain’s quarterly results.
Brooke DiPalma of Yahoo Finance reports:
McDonald’s customers are tightening their belts again in the second quarter as they struggle to afford their Big Mac.
On Monday morning, the company reported second-quarter earnings that missed Wall Street estimates in terms of revenue, profits and same-store sales, proving that not even the largest fast-food player in the United States is immune to challenging macroeconomic conditions.
To read more here.
Shares of the fast food chain initially opened lower but quickly recovered and gained as much as 3% in early trading.
Stocks open higher to kick off a big week on Wall Street
Stocks rose on Monday to kick off a big full week with a Federal Reserve rate decision, the jobs report and tech earnings.
The Dow Jones Industrial Average (^DJI) rose slightly, coming out of a recent increase of over 650 points. The S&P 500 (^GSPC) added about 0.3%, while the Nasdaq Composite (^IXIC) rose 0.5%.
The Federal Open Market Committee will hold its scheduled two-day meeting this week, with no rate moves expected from Federal Reserve officials on Wednesday. Most investors see policymakers waiting until September to cut interest rates.
Earnings from major tech companies are due to be released this week, including Apple (AAPL), Microsoft (MSFT), Amazonas (AMZN) and Meta (GOAL).
A Morning Chart to Get You Thinking
And so begins an extremely busy week for investors.
Investors start the week hurt by last week’s surprise tech sell-off, which may just be beginning, reports Seana Smith of Yahoo Finance.
RBC strategist Lori Calvasina contextualizes the tech sector shutdown below.
Hot stocks start to stagnate in July. (RBC)
