Opening Comment — Monday, July 15, 2024
DJIA: 40,000.90, up 247.15
S&P 500: 5,615.35, up 30.81
NASDAQ: 18,398.45, up 115.04
Stocks higher as the week begins
Stock futures are higher on Monday, ahead of the latest second quarter earnings releases. Investors are considering the implications of the attempted assassination of former U.S. President Donald Trump, while also looking forward to comments from Federal Reserve (Fed) Chair Jerome Powell, who is scheduled to be interviewed today. The Dow is increasing 0.6%, while the S&P 500 is up 0.5%. The Nasdaq 100 is also rising 0.6% relative to fair value on the GLOBEX.
U.S. equities were higher on Friday, as investors digested June’s Producer Price Index (PPI) data, which came in hotter than projections. The Dow was up 0.6%, while the tech-heavy Nasdaq Composite also rose 0.6%. The S&P 500 increased 0.6% with 10 of 11 sectors finishing in positive territory. The Consumer Discretionary sector gained the most, rising 1.0%.
On the data front Friday, June’s PPI for final demand increased 0.2% month-over-month (MoM), versus the prior month’s revised zero growth, and increased 2.6% year-over-year (YoY) versus the prior month’s revised rise of 2.4%. Core PPI, which excludes the more volatile food and energy components, increased 0.4% MoM, versus the prior month’s revised 0.3%, and increased 3.0% YoY versus the prior month’s revised increase of 2.6%. The preliminary reading of the University of Michigan Consumer Sentiment Index recorded 66.0 for July, down from the prior month’s reading of 68.2. Meanwhile, July’s preliminary readings for the University of Michigan’s one- and 5-10-year inflation expectations both recorded 2.9%, both down from the prior month’s readings of 3.0%.
Across the pond, European stocks are lower in mid-day trading as investors look forward to the European Central Bank’s (ECB’s) latest rate decision, due later this week.
Overnight in Asia, stocks were mixed following China’s second quarter Gross Domestic Product (GDP) growth slowing more than expected compared from the first quarter. The country’s retail sales increased less than projected in June, while industrial production rose more than expectations.
In FOREX trading, the dollar is slightly higher attributed in part to the perceived safe-haven demand following the attempted assassination of former U.S. President Donald Trump. Meanwhile, the yen is weakening following last week’s suspected intervention attempts from Japan.
Over in the commodity pits, West Texas Intermediate (WTI) crude oil is 0.1% lower at $82.14/barrel amid political uncertainty in the U.S., while investors monitored the progress of Gaza ceasefire talks.
In the metals complex, gold is 0.1% lower at $2417.40/ounce following a strengthening dollar.