Nasdaq Declines While Dow Surges Amid Strong Retail Reports
Unlike last week, Wall Street is making a rally this week by posting three consecutive days of high wins. Following strong retail sales in July, the stock market’s main indexes were boosted amid increasing hopes of the end of the interest rate festival.
This morning Wall Street edged higher; the S&P 500 benchmark was up by 0.02%, totaling 4.442.18 points. Nasdaq swings up and down, and now the index is currently negative by 0.18%.
The Dow Jones industrial average jumped by 0.31% to 35.110.10 points.
In some sense, The impressive retail sales data has led to speculation about the potential trajectory of the economy, with ING Economic and Financial Analysis suggesting that a 3% GDP growth rate could be achievable for the third quarter.
According to the released report, July retail sales numbers show signs of strengthening the economy despite the market turmoil. The retail sector performed well in July, outperforming forecasts with a 0.7% increase in month-on-month sales. This expansion demonstrates the tenacity of consumers, who have continued to contribute to the nation’s economic prosperity. Meanwhile, in China, a report says that China will miss its targeted GDP growth this year. China and Russia reported declines in their manufacturing and economic activities this year. The news was headlined by the failure of the new world order. Yesterday, several reports confirmed that it had significantly reduced several important rates in an urgent move that it hoped would support its recent failure and strengthen its economy. However, Russia reacted with another approach.
The Russians hiked their key interest rates by 3.5%; this high percentage gives a clear idea about the economy’s challenges, including low liquidity and inflationary pressure.
In the realm of retail, Target shares surged by 6.3% following a better-than-expected second-quarter profit, despite a reduction in its annual forecast.
Meanwhile, the giant retail store Walmart gained 0.5% ahead of its upcoming earnings report. Furthermore, Macy’s and Kohl’s registered increases of 2.1% and 0.7%, respectively. This surge in their shares reflects their persistent efforts to adapt and thrive amidst changing consumer preferences.
Moving to the automatic sector, the data shows a strong performance in the sector, plus other strong performances observed in the health and personal care sectors.
Investors anticipate a continued hawkish stance in the minutes, meaning a relatively cautious approach to monetary policy. Sam Stovall from CFRA Research noted that investors expect the Federal Reserve to maintain this cautious tone. While some economists predict rate cuts in early 2024, there’s a concern that the Fed might keep rates elevated for a longer duration to ensure inflation decreases as intended.
In other economic news, oil prices remained higher despite today’s decline. The West Texas Intermediate price fell by 0.22% to $80.04 per barrel. Brent oil was down by 0.16% to $84 per barrel, and natural gas prices crashed by 3.6% to $2.5 per gallon.