Wall Street joins record-breaking eventful weekend


NEW YORK (AP) – Stocks hit record highs on Wall Street on Friday and the Dow Jones Industrial Average closed above the 35,000 level for the first time, as the market continued to roar after its short-lived plunge at the start of the week. .

The S&P 500 Index climbed 44.31, or 1%, to 4,411.79 to break its previous all-time high, set early last week. The Dow Jones rose 238.20, or 0.7%, to 35,061.55, and the Nasdaq composite gained 152.39, or 1%, to 14,836.99.

All three indices finished with gains above 1% for the week, completely dismissing the steep drop that slashed the S&P 500 by 1.6% on Monday.

The drop was caused by concerns about a potentially sharp slowdown in the economy due to a rapidly spreading variant of the coronavirus. But the S&P 500 has since climbed four straight days, as large companies reported better-than-expected earnings and investors once again viewed any decline in stocks as a mere chance to buy low.

The economy continues to recover at a breakneck pace, the question being how much growth will slow down in the months and years to come. A preliminary report from IHS Markit released on Friday indicated that US manufacturing growth could accelerate unexpectedly in July, although growth in the service industries appears to be slowing more than economists expected.

The 10-year Treasury yield gave up some of its gain after the report was released, but still rose to 1.27% from 1.26% on Thursday night. For months, it sent a worrying alarm on the economy as it had fallen from a level of around 1.75% at the end of March. But aside from Monday’s sudden swoon, the S&P 500 mostly continued to climb.

Staff supplier Robert Half International jumped 7.4% for one of Friday’s biggest gains in the S&P 500 after reporting revenues and profits for the last quarter that beat Wall Street expectations. He said he was witnessing a widespread global acceleration in demand for his services.

He led a widespread rally in the market, where more than 80% of S&P 500 stocks rose. Communications actions led the way after Twitter released results that beat Wall Street forecasts on growing advertising demand. It climbed 3%. Snap, the parent company of social media app Snapchat, climbed 23.8% after reporting much better-than-expected results.

Such surprises have become the norm this reporting season. With about a quarter of all earnings reports for S&P 500 companies, nearly 90% exceeded Wall Street’s already high expectations for the spring.

Companies in the index are set to report about 74% growth in earnings in the second quarter from a year ago, according to FactSet. It would be the strongest growth since the economy emerged from the Great Recession in late 2009.

Concerns have grown over inflation, which has exploded recently. But companies have nevertheless managed to maintain their profits, often by raising their own prices.

S&P 500 companies appear on track to report that they made $ 124 in profit for every $ 1,000 in sales, according to FactSet. That would be a slight dip from $ 128 in the first three months of the year, but it would still be comfortably above the $ 108 average over the past five years.

American Express rose 1.3% following its quarterly earnings report, which showed increased revenue amid rising customer spending at restaurants, stores and entertainment venues.

On the losing side, Intel fell despite posting strong second-quarter earnings. It fell 5.3 percent.

Boston Beer Co., which brews Samuel Adams, fell 26% amid concerns over skyrocketing hard seltzer water sales.

As Wall Street looks to 2021 and next year, a major concern remains the potential for “stagflation,” said Jay Hatfield, CEO of Infrastructure Capital Advisors. This is when inflation continues to rise while economic growth stagnates. Most analysts expect growth to continue to moderate as the pandemic subsides and the U.S. government and Federal Reserve relax their support.

“How do you go from hypergrowth to stagflation, how do you assess that? ” he said. “It’s a key forgery. “

In European stock markets, indices also rose by around 1%. Asian stock markets were mixed, with Hong Kong’s Hang Seng down 1.4% and South Korea’s Kospi up 0.1%.


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