THE WEEK ON WALL STREET
In a holiday-shortened week, stock prices turned higher as encouraging economic data outweighed an increase in COVID-19 cases and a rollback in economic re-openings.
The Dow Jones Industrial Average rose 3.25%, while the Standard & Poor’s 500 increased by 4.02%. The Nasdaq Composite Index gained 4.62% for the week. The MSCI EAFE Index, which tracks developed stock markets overseas, picked up 0.22%.1,2,3
STOCKS CLIMB A WALL OF WORRY
Stock prices moved higher on optimism of continued central bank support and a wave of buying on the final trading days of the second-calendar quarter.
On Wednesday, investors were emboldened by news of promising results from a COVID-19 vaccine trial. Stocks continued their move to the upside on Thursday, sparked by a better-than-expected jobs report and a higher-than-expected read on manufacturing activity.
JOBS, JOBS, JOBS
The ultimate measure of economic recovery is jobs for Americans, and last week, Wall Street got an update from three different perspectives.
First, the ADP (Automatic Data Processing) National Employment Report, which reported private-sector employers added 2.37 million jobs in June. Next, an update on jobless claims, which showed 1.43 million claims, slightly higher than estimates. And finally, the June employment report from the Bureau of Labor Statistics, which showed 4.8 million jobs added, and the unemployment rate falling to 11.1%. Both numbers were better than expected.4,5,6
While the employment numbers painted a mostly positive picture, it’s important to remember that the June wave of rehiring was prior to the increase in COVID-19 cases, which has caused some states to revisit their re-opening plans.
THE WEEK AHEAD: KEY ECONOMIC DATA
Monday: Purchasing Managers Index (PMI) Services Index. Institute for Supply Management (ISM) Non-Manufacturing Index.
Tuesday: Job Openings and Labor Turnover Survey (JOLTS).
Thursday: Jobless Claims.
Source: Econoday, July 2, 2020
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.
THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Tuesday: Paychex (PAYX), Levi Strauss (LEVI).
Wednesday: Bed, Bath & Beyond (BBBY).
Thursday: Delta Airlines (DAL), Walgreens Boots (WBA).
Source: Zacks, July 2, 2020
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- The Wall Street Journal, July 2, 2020
2. The Wall Street Journal, July 2, 2020
3. The Wall Street Journal, July 2, 2020
4. MarketWatch, July 1, 2020
5. CNBC, July 2, 2020
6. The Wall Street Journal, July 2, 2020
The Wall Street Journal, July 2, 2020
The Wall Street Journal, July 2, 2020
Treasury.gov, July 2, 2020