Equities Eek Out Gains Ahead of Action-Packed Week…..

U.S. stocks closed modestly in the green and back in record high territory, as the markets returned to action following last week’s wild swing that saw the markets overcome an early selloff. Investors appeared to take a cautious outlook in the narrow trading session as participants began to look ahead to what will be a busy week of data. Over the next several days the markets will digest numerous key earnings reports as some mega-cap growth stocks are on the docket, while the midweek Fed monetary policy decision headlines a heavy economic calendar. Meanwhile, the persistent spread of the Delta coronavirus variant that has fostered global growth uncertainty and the continued crackdown in China continued to loom over the markets, adding to some market hesitancy. In corporate news, Hasbro rose on the heels of its earnings results and Lockheed Martin was lower after posting mixed results. The busy economic week began with a third-straight monthly decline in new home sales, and Dallas manufacturing growth slowed unexpectedly. Treasuries were mostly lower as yields rose, while the U.S. dollar pulled back from its rebound. Gold and crude oil prices dipped. Asia finished mixed as China and Hong Kong fell amid the continued Chinese crackdown, while Europe also closed mixed.

The Dow Jones Industrial Average rose 83 points (0.2%) to 35,144, the S&P 500 Index advanced 11 points (0.2%) to 4,422, while the Nasdaq Composite increased 4 points to 14,841. In moderate volume, 870 million shares were traded on the NYSE and 4.4 billion shares changed hands on the Nasdaq. WTI crude oil ticked $0.16 lower to $71.91 per barrel. Elsewhere, the gold spot price decreased $2.60 to $1,799.20 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—declined 0.3% to 92.63.

New home sales fall, regional manufacturing activity surprisingly dips as heavy week begins

New home sales declined 6.6% month-over-month (m/m) in June to an annual rate of 676,000 units, below the Bloomberg forecast calling for a rate of 796,000 units, and compared to May’s downwardly-revised 724,000-unit level. The median home price rose 6.1% y/y to $361,800. New home inventory increased to a 6.3-months supply at the current sales pace from the 5.5-months level in May. Sales in the Midwest moved higher m/m but sales in the Northeast, South, and West all dropped. Sales in the Northeast, South and West were solidly lower compared to the same period a year ago, while sales in the Midwest were higher. New home sales are based on contract signings, offering a timelier read on housing activity compared to the larger contributor of existing home sales, which are based on closings.

The July Dallas Fed Manufacturing Index unexpectedly declined but remained comfortably in expansion territory (a reading above zero). The index decreased to 27.3 from 31.1 in June and compared to forecasts calling for a modest rise to 31.6.

Treasuries were mostly lower, as yields remained choppy following a recent drop. The yield on the 2-year note was little changed at 0.19%, while the yield on the 10-year note increased 1 basis point (bp) to 1.29%, and the rate on the 30-year bond rose 3 bps to 1.94%.

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