Alex Eule
Happy Markets. Last week, stocks got a big boost from earnings. This week, it was all about the economy. And while the news isn't all good, it made the market happy.
Stocks rose and bond yields fell Friday in the wake of a payrolls report that showed the economy shed 23,000 jobs in July. It's the kind of miss that moves markets. Economists had forecast a job gain of 95,000. The job gains for May and June were also revised lower. All this means it's less likely the Federal Reserve will be pushed to raise interest rates at an upcoming meeting. Thus, the bad news was seen positively by stocks.
The Nasdaq Composite, which is full of rate-sensitive growth stocks, finished the day up 1.3% and wrapped its best week since April. The tech-heavy index, which fell for much of June and July, is now back to just 1.3% from its record high.
The S&P 500, meanwhile, closed the day at a record, up 0.6% for the session, and 3.6% for the week.
At some point, investors will have to grapple with that all these means for the economy. That's a problem for another day.
Watch our TV show on Fox Business Saturday and Sunday at 10:30 a.m. ET. This week, Mary Ann Bartels of Sanctuary Wealth explains why the S&P 500 will rally another 7% through year end. Plus, what's behind the market's revival and what looks attractive? Plus, Barron's newsletter portfolio is growing. Barron's Global Signals is a premium weekly newsletter devoted to helping investors navigate volatility with confidence. Each week we connect how global risk, policy shifts and international developments impact your portfolio. You can subscribe to Barron's Global Signals here
The Hot Stock: Airbnb +17.4% The Biggest Loser: Trade Desk -21.9%
Best Sector: Materials +1.5% Worst Sector: Energy -1.2%
This Weekend's Magazine
The Calendar
The drop in Treasury yields will be put to the test next week when the Bureau of Labor Statistics releases the consumer price index on Wednesday. The BLS also reports wholesale inflation on Thursday, while the Census Bureau releases retail sales statistics on Friday.
The bulk of earnings season is over, with nearly 90% of S&P 500 companies having reported. Corporate America has once again passed with flying colors, which is reflected in record equity prices.
Ten more S&P 500 constituents are set to announce results next week including Simon Property Group on Monday, Super Micro Computer on Tuesday, Cisco Systems on Wednesday, and Applied Materials and Tapestry on Thursday.
What We're Reading Today
-- SPACs Are Roaring Back. This Red-Hot Stock Is a Cautionary Tale.
-- A Volatile Week for Tech Revealed New Stock Narratives -- and 1 Bargain
-- It's the Best Time in Years to Rebalance for Retirement. 2 Moves to Make
Now.
-- Senate Delays Clarity Act Vote. Crypto's Priority Is Now a Hail Mary.
-- And this weekend's Barron's cover story: The New Wild West: Texas
Experiments With Raw Capitalism
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