U.S. stocks finished mixed amid a slew of data, and as hopes of a near-term rate cut were tempered as some Fed members indicated that a September cut is not a certainty, while reports also suggested Germany’s central bank does not see a need for fiscal stimulus at this point. The Fed began its key gathering in Jackson Hole, Wyoming, which will culminate with tomorrow’s speech from Fed Chief Jerome Powell, adding an additional layer of caution. In economic news, jobless claims fell and the Leading Index rebounded by the most in nearly a year, though Market’s manufacturing report showed the first contraction since 2009. Earnings from the retail sector continued in earnest, with Dick’s Sporting Goods and Nordstrom rallying on their results, but L Brands fell sharply after disappointing with its same-store sales and guidance. Treasury yields rose and the U.S dollar nudged lower, while crude oil prices and gold also lost ground.
The Dow Jones Industrial Average (DJIA) rose 50 points (0.2%) to 26,252, the S&P 500 Index decreased 2 points (0.1%) to 2,923, and the Nasdaq Composite declined 29 points (0.4%) to 7,991. In light volume, 683 million shares were traded on the NYSE and 1.7 billion shares changed hands on the Nasdaq. WTI crude oil fell $0.45 to $55.68 per barrel and wholesale gasoline was $0.01 higher at $1.69 per gallon. Elsewhere, the Bloomberg gold spot price declined $4.08 to $1,498.57 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was 0.1% lower at 98.17.
Weekly initial jobless claims fell by 12,000 to 209,000, versus the Bloomberg estimate of 216,000, with the prior week’s figure being revised higher by 1,000 to 221,000. The four-week moving average ticked higher by 500 to 214,500, while continuing claims dropped by 54,000 to 1,674,000, south of estimates of 1,707,000.
The Conference Board’s Index of Leading Economic Indicators (LEI) for July rose 0.5% month-over-month (m/m)—the largest increase in nearly a year—versus projections of a 0.3% gain and compared to June’s favorably-revised 0.1% decline. Positive contributions from the jobless claims, building permits, stock prices, credit and consumer expectations components of the index, more than offsetting declines for ISM new orders and average workweek.
The preliminary Market U.S. Manufacturing PMI Index showed the first contraction in almost 10 years in August, decreasing to 49.9 from July’s unrevised 50.4 figure, and versus expectations of a slight increase to 50.5. The preliminary Market U.S. Services PMI Index showed growth fell more than expected but remained slightly in expansion territory for the key U.S. sector this month, decreasing to 50.9 from July’s 53.0 figure, and versus forecasts of a dip to 52.8. A reading of 50 for both indexes is the demarcation point between expansion and contraction.
Treasuries were lower in choppy trading, as the yield on the 2-year note increased 4 basis points to 1.61%, the yield on the 10-year note was up 3 bps at 1.61%, and the 30-year bond rate rose 5 bps to 2.10%.
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