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US major averages rise after wrapping up winning month

PUBLISHED

2023-08-01

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Stocks rose modestly Monday as Wall Street kicked off a busy earnings week and wrapped up a winning month.

For the month of July, the S&P 500 jumped 3.1 per cent to notch its fifth consecutive positive month for the first time since its seven-month streak ending August 2021.

The tech-heavy Nasdaq Composite gained about 4.1 per cent and registered its fifth straight winning month for the first time since April 2021.

The blue-chip Dow added about 3.4 per cent. Last week, the index posted a 13-day advance that matched its longest streak of gains going back to 1987.

Overall, the Dow Jones Industrial Average added 100.24 points, or 0.28 per cent, to settle at 33,559.53. The S&P 500 edged up 0.15 per cent to close at 4,588.96, and the Nasdaq Composite rose 0.21 per cent to end at 14,346.02.

Investors in recent weeks have grown increasingly more hopeful about a soft landing scenario as economic data shows ongoing strength in the labour market and cooling inflation. Second-quarter earnings also continue to trickle in better than expected.

While earnings season is more than halfway through, investors are keeping an eye on Thursday's reports from Amazon and Apple, which could "set the tone" for the rest of the market.

Last week, the Federal Reserve hiked rates to their highest level in more than 22 years after passing a much-anticipated quarter-point hike. Fed Chair Jerome Powell said the central bank will make data-driven decisions on a "meeting-by-meeting" basis.

Along with earnings, investors remain focused on Friday's jobs report. Economists polled by Dow Jones expect the US economy to have added 200,000 jobs in July. Nonfarm payrolls increased 209,000 in June.

In commodity news, oil is on track for its biggest monthly gain in over a year due to indications of a tightening market, as analysts suggest that crude demand is at a record level while OPEC+ reduces production.

New York crude futures have recovered their year-to-date losses and surged over 15 per cent this month, potentially achieving the largest gain since January 2022, partly boosted by expectations of the Federal Reserve's nearing end of monetary policy tightening.

Turning to US sectors, most closed higher overnight. On the back of the news that oil is on track for its biggest monhtly gain in over a year, Energy was the best performer. Healthcare was the worst performer.

US Commerce Secretary Gina Raimondo is considering a visit to China in late August as part of the Biden administration's efforts to ease tensions between the US and China, the world's two largest economies. The planned trip is aimed at reducing friction and fostering dialogue. However, specific dates for the visit have not been confirmed yet and are subject to change.

Futures

The SPI futures are pointing to a 0.3 per cent gain.

Currency

One Australian dollar at 7:20 AM was buying 67.20 US cents.

Commodities

Gold added 0.47 per cent. Silver gained 1.95 per cent. Copper advanced 2.08 per cent. Oil gained 1.51 per cent.

Figures around the globe

European markets closed mixed. London’s FTSE added 0.07 per cent, Frankfurt fell 0.14 per cent, and Paris closed 0.28 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei gained 1.26 per cent, Hong Kong’s Hang Seng added 0.82 per cent while China’s Shanghai Composite closed 0.46 per cent higher.

The Australian sharemarket closed 0.09 per cent higher at 7410.

Ex-dividends

NB Global Corporate Income Trust (ASX:NBI) is paying 1.2179 cents unfranked
Partners Grp Global (ASX:PGG) is paying 1.35 cents unfranked

Dividends payable

Collins Foods (ASX:CKF)
Blackmores (ASX:BKL)
Timah Resources (ASX:TML)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
Disclaimer

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