Price Return Last Week
S&P 500 (2.1%) S&P Mid Cap (4.1%) Russell 2000 (6.7%)
MSCI EAFE (2.0%) MSCI EM (1.0%)
10 Yr US Treasury Rate – fell from 4.20% to 3.80%
Source: Refinitiv Eikon
Recent News
Jobs Report – July: 114k (Reuters Poll est. 175k) June: 206k
In addition to the number of new jobs added falling 61,000 below expectations, jobs added in previous months were revised lower by 29,000. Data also showed average hourly earnings slowing to 3.6% year-over-year, the lowest rate since May 2021. Overall, the report seems to confirm a slight weakening in the economy and should give the Fed the evidence they need to cut rates next month.
Source: The Wall Street Journal
NASDAQ Enters Correction Territory – The NASDAQ Composite Index closed down 2.5% on Friday. Since the peak on July 10, the index has fallen just over 10% to officially enter correction territory.
Source: Refinitiv Eikon
Fed Meeting – The Federal Reserve chose to leave interest rates unchanged at a range between 5.25% and 5.5%. However, they appeared to lay the groundwork for a cut at their next meeting in September. In a press conference following the conclusion of their meeting, Fed Chair Jerome Powell stated that “a reduction in the policy rate could be on the table as soon as the next meeting.” They also made two important changes to their policy statement. They described inflation as only “somewhat elevated,” compared to past statements that listed inflation as “elevated.”
Source: The Wall Street Journal
BoE Cuts Rates – The Bank of England lowered their key interest rate from 5.25% to 5%. The first cut in over four years. While U.K. inflation has fallen to 2%, services inflation has remained high at nearly 6%. Of the nine voting members, five voted for the cut and four voted to keep rates the same.
Source: The Wall Street Journal
Market Corrections – A market correction occurs when an asset falls at least 10%, but not more than 20%, from a recent high. When an asset falls more than 20%, it is considered a bear market. The Nasdaq Composite has endured 71 corrections in its history, including Friday. Despite these corrections, the index remains up approximately 161 times since inception in 1971 for an annualized return of approximately 9%.
Source: MarketWatch, Refinitiv Eikon
Upcoming Events
8/5 – ISM Non-Manufacturing PMI, Notable Earnings Reports: ONEOK, Simon Property Group
8/6 – Notable Earnings Reports: Caterpillar, Fidelity National Information Services, Zoetis, Uber, Constellation Energy, Airbnb, Amgen, Super Micro Computer
8/7 – Notable Earnings Reports: Disney, CVS, Hilton, Rockwell Automation, Warner Bros Discovery, Monster Beverage, Marathon Oil, Occidental Petroleum
8/8 – Notable Earnings Reports: Eli Lilly, Vistra, Expedia, Gilead Sciences
Source: Refinitiv Eikon
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