To The Moon

Major market averages pivoted higher on Monday's trading session after Wall Street watched a strong July performance.

The Nasdaq index rose 0.78%, the S&P 500 index gained 0.26% and the Dow was up 0.21% in early morning trading.

Yields appear relatively unchanged. The U.S. 10-year Treasury yield (US10Y) is near flat at 2.64%, while the U.S. 2-year Treasury yield (US2Y) has risen 1 basis point to 2.90%.

Crude declined $5 per barrel as the price of oil fell below $94 a barrel early on.

S&P PMI Manufacturing came in slightly below expectations at 52.2.The consensus figure was 52.3.

Additionally, July ISM Manufacturing numbers came in lower then anticipated at 52.8, versus the forecasted 53.

June MoM Construction Spending came in softer than estimates of -0.1% at -1.1%.

Investors turn the page after a strong July rally and look to continue the forward trend in August.

Deutsche Bank highlighted in an investor note that “July’s gains were led by a combination of factors, including the prospect of the Federal Reserve pivoting due to softening economic conditions and potential peaking in inflationary factors.”

The note continued with: “Concerns about growth slowing and some signs that inflation might be peaking meant that investors began to price in a less aggressive pace of monetary tightening from the Fed over the coming months. In fact, markets are pricing rate cuts now within the next six months.”

In another note: Morgan Stanley highlighted: “With equity markets continuing to rally last week in the face of a tighter Fed, still high inflation and generally weaker earnings/economic data, we further explore our thesis from last week as to why. Bottom line, the Fed has quickly regained its credibility and that's good for bonds, not stocks.”

Among active stocks, shares of NIO have jumped as the Chinese EV maker saw 27% Y/Y growth as the firm delivered over 10K vehicles for the month of July.