Market Perspective for September 1, 2024

The final full trading week in August was another eventful one, with several important news releases coming out. Most importantly, nothing has ruled out the possibility of an interest rate cut next month. In fact, some Fed members were openly admitting that the time had come to ease fiscal policy.

On Tuesday, the CB Consumer Confidence index was released and came in at 103.3, which was higher than the expected 100.9. It also came in higher than last month’s figure of 101.9. Ultimately, this means that respondents were bullish about what was to come for the economy despite the negative news released the previous week. Last Wednesday, it was revealed that there were 818,000 fewer jobs added to the economy from April 2023 to May 2024.

On Thursday, the preliminary gross domestic product (GDP) for the previous quarter was made public. During the previous three months, the economy grew by an estimated 3 percent compared to an expected increase of 2.8 percent. Also on Thursday, unemployment claim data was released and showed that there were 231,000 requests for benefits compared to an expected 232,000 requests.

On Friday, a slew of data was released including the Core PCE Price Index, which was up .2 percent on a monthly basis. This matched expectations as well as the result from last month’s report. In addition, the University of Michigan released its revised consumer sentiment and inflation expectation reports. Consumer sentiment was 67.9 percent compared to an expected 68 percent while inflation was expected to be at 2.8 percent roughly 12 months from now.

The S&P 500 finished the week down 6.74 points to close at 5,648, which was a decrease of .12 percent for the week. This was despite a strong close on Friday that saw the market gain 56 points or 1 percent. On Wednesday, the market made its low of the week at 5,566 and would make its high of the week on Monday morning at 5,649.

The Dow closed the week up 199.64 points to finish at 41,563, which was an increase of .48 percent. On Friday, the Dow 222 points to push the index into the black for the previous five trading days. On Wednesday afternoon, the market hit its low of the week at 40,861 while it closed at its weekly high.

The Nasdaq finished the week at 17,713, which was a decrease of 264 points or 1.48 percent. As with the other two indexes, the Nasdaq did make up some ground on Friday as it finished the day up 1.13 percent or 197 points. On Monday, the market opened at its weekly high of 17,902 and it would make a weekly low of 17,473 on Wednesday afternoon.

In international news, Australia announced its most recent annual CPI figures. Inflation in the country was 3.5 percent on an annualized basis compared to an expectation of 3.4 percent. On Thursday, it was revealed that German CPI was down .1 percent on a monthly basis while Spanish inflation was 2.2 percent on an annualized basis.

On Thursday evening, Japan announced its CPI came in at 2.4 percent on an annualized basis compared to an expected 2.2 percent. On Friday morning, Canada announced that its GDP growth was flat over the past month compared to an expected increase of .1 percent.

The upcoming week starts slow because of the Labor Day holiday, but both the ADP and Bureau of Labor Statistics (BLS) nonfarm payroll (NFP) reports come out on Thursday and Friday respectively.

On Tuesday, the ISM Manufacturing PMI report is released while the JOLTS job opening report comes out on Wednesday. Finally, unemployment claims data and ISM Services PMI comes out on Friday along with unemployment and hourly wage data. Canada will also announce employment change and hourly wage data on Friday morning.

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