Wild Week Comes to Close with Bulls in Charge…..

U.S. equities finished higher to cap off a wild week, rebounding decisively from Monday’s malaise, while posting the fourth weekly gain in five and notching record highs along the way. The resiliency came after concerns about the global spread of the Delta coronavirus variant and uncertainty regarding if we have reached peak earnings and economic growth rates led to the early week selloff. Q2 earnings season remained in high gear, with positive results from Dow member American Express and Twitter lifting their shares, while Dow members Intel and Honeywell International, along with Boston Beer Company, all fell on the heels of their reports. Investors also sifted through a slew of mixed July global manufacturing and services sector reports, including domestic reads that showed manufacturing growth surprisingly accelerated but services sector expansion decelerated more than expected. Treasuries were mixed after seeing some pressure this week leading to a rebound in yields, and the U.S. dollar ticked higher, while gold lost ground and crude oil prices saw only modest gains. Overseas, markets in Europe were broadly higher, adding to the week’s sharp rebound, while stocks in Asia were mixed amid lighter-than-usual volume with Japan again closed for a holiday.

The Dow Jones Industrial Average rose 238 points (0.7%) to 35,062, the S&P 500 Index advanced 44 points (1.0%) to 4,412, while the Nasdaq Composite increased 152 points (1.0%) to 14,837. In moderate volume, 813 million shares were traded on the NYSE and 3.9 billion shares changed hands on the Nasdaq. WTI crude oil ticked $0.16 higher to $72.07 per barrel. Elsewhere, the gold spot price decreased $4.99 to $1,801.93 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—rose 0.1% to 92.88. Markets were higher for the week, as the DJIA gained 1.1%, the S&P 500 moved 2.0% higher, and the Nasdaq Composite jumped 2.8%.

July manufacturing growth surprisingly accelerates, but services declines more than expected…..

The preliminary Markit U.S. Manufacturing PMI Index for July unexpectedly improved to 63.1 from June’s unrevised 62.1 figure, moving further into expansion territory as denoted by a reading above 50. The Bloomberg consensus estimate called for the index to dip to 62.0. The preliminary Markit U.S. Services PMI Index showed growth (above 50) for the key U.S. sector decelerated more than expected, declining to 59.8 from June’s 64.6 figure, and compared to forecasts of a dip to 64.5.

Markit said combining both manufacturing and services sector activity data, the composite index showed U.S. private sector companies reported a further substantial expansion in business activity during July. That said, the rate of growth eased for the second month running to the softest since March, as firms continued to report widespread capacity constraints.

Treasuries were mixed after seeing some pressure as of late to allow yields to claw back from an early-week drop. The yield on the 2-year note dipped 1 basis point (bp) to 0.19%, while the yields on the 10-year note and the 30-year bond rose 1 bp to 1.29% and 1.92%, respectively.

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