M Notes: Mon, 8-4

LAST WEEK:

Markets:  Even though many Tariff deals have been reached, some haven’t.  And Markets retreated on that news last Friday.  

S&P roller coaster last week:  Down a touch, Up, Down a touch, Down, and Down significantly.

Fed Balance Sheet:  $6.643 Trillion. 

Fed Meeting:  No rate cut.   Fed Chair Powell defended the move citing concerns about Inflation.  Markets dropped a touch in response.  For the first time in over 30 years (1993), more than one Fed official dissented.   The vote was 10-2 to keep rates the same.  With a tough July Jobs number, pressure will mount on the Fed to cut rates in September.   We might get a hint at the Fed’s Jackson Hole annual symposium that takes place in two weeks (August 21-23).   

GDP:  The second read on Q2 GDP came in at +3.0%.   Q1 came in at -0.5%.

Inflation:  The Personal Consumption & Expenditures index (the PCE) saw Inflation rise from 2.3% (May) up to 2.6% Y/Y in July.  

ISM:  The Institute for Supply Management’s Manufacturing index dropped from 49.0 (June) to 48.0 (July).  Manufacturing represents 30% of the US economy.  A number above 50 represents expansion, while a number below 50 represents a contraction.   

Jobs:  It missed the consensus 110,000 new jobs, coming in at only 73,000.  The BLS has been under watch for years now… giving rosy numbers during the Biden administration, only to see significant revisions downward later.  Trump fired the head of the BLS last week, claiming the low July number was more about politics (against him) than providing an accurate number.  

Jobless claims:  The weekly number came in at 218,000.  The four-week average came in at 221,000.

National Debt:  $37.188 Trillion.  (It’s going up about $28-30 Billion/week.)

Unemployment:  As expected, the U3 Unemployment rate rose a tick from 4.1% (June) to 4.2% in July.  

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THIS WEEK:

Focus of the week:  After a tough week last week, will Markets rebound?

Calendar:   Factory orders (Mon); the Trade Deficit, ISM Services index (Tue); and jobless claims (Thu).

Earnings:  Some of the companies reporting this week are:  AMD, Amgen, Caterpillar, ConocoPhillips, Disney, Eaton, Eli Lilly, McDonald’s, Parker Hannifin, Pfizer, Shell, Sony, Toyota, and Uber.   

* The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.    The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks.  The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System.  Yahoo! Finance, the Wall Street Journal, Investor’s Business Daily and Barron’s are several of the sources used for financial information. 

* The National Debt figure comes from usdebtclock.org.   

* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.  Consult your financial professional before making any investment decision.  You cannot invest directly in an index.   Past performance does not guarantee future results. No strategy can assure a profit or protect against a loss.  Investments in the securities markets involve risk, such as loss of your principal.