For the first day of Q3 the S&P with an increase of 22 points once again hit another record, this time the sixth straight record close. Great economic data has given the markets plenty of confidence so once again investors are pulling out of tech and back to the Dow cyclicals with a zoom up of 131 points. But the best news per today’s expert, “Historical data shows if you have a strong first half, the second half will be even stronger.”  Jobless claims continued downward as the worker shortage continues. All eyes as always will be on Friday’s employment report but all employment and manufacturing data supports the idea of continued growth. If Friday’s report is also on target, we’ll see another up day, though there is the possibility that strong employment will stoke more inflation fears and bring the markets down. Friday’s payroll data is expected to be a plus 700K.  Volume is again a little below average at 9.5 billion. 

Thu  July 1, 2021  6:36 PM

S&P 500 winning streak extends to sixth straight record close

Stephen Culp

DJ: 34,502.51  +210.22        NAS: 14,503.95  -24.38        S&P: 4,297.50  +5.70       6/30

DJ: 34,633.53  +131.02        NAS: 14,522.38  +18.42        S&P: 4,319.94  +22.44     7/1

NEW YORK, July 1 (Reuters) - The S&P 500 reached its sixth consecutive all-time closing high on Thursday, as a new quarter and the second half of the year began with upbeat economic data and a broad-based rally.  Investors now eye Friday's much-anticipated employment report.  The bellwether index is enjoying its longest winning streak since early February, and the last time it logged six straight all-time highs was last August.  "Historical data shows if you have a strong first half, the second half of the year was actually going even stronger," said Ross Mayfield, investment strategy analyst with Baird Private Wealth.  All three major U.S. stock indexes ended the session in positive territory, but a decline in tech shares - led by microchips - tempered the Nasdaq's gain.

The Philadelphia SE Semiconductor index (.SOX) slid 1.5%  "For markets so far this year, boring is beautiful," said David Carter, chief investment officer at Lenox Wealth Advisors in New York. "Economic growth has been strong enough to support prices and many asset classes are trading with historically low volatility."  "It feels like investors left for the Fourth of July weekend about three months ago."

The ongoing worker shortage, attributed to federal emergency unemployment benefits, a childcare shortage and lingering pandemic fears, was a common theme in the day's economic data.  Jobless claims continued their downward trajectory according to the Labor Department, touching their lowest level since the pandemic shutdown, and a report from Challenger, Gray & Christmas showed planned layoffs by U.S. firms were down 88% from last year, hitting a 21-year low. read more

Activity at U.S. factories expanded at a slightly decelerated pace in June, according to the Institute for Supply Management's (ISM) purchasing managers' index (PMI), with the employment component dipping into contraction for the first time since November. The prices paid index, driven higher by the current demand/supply imbalance, soared to its highest level since 1979, according to ISM.  "The employment and manufacturing data released today supported the idea of continued growth but at a decelerated rate," Carter added.

Friday's hotly anticipated jobs report is expected to show payrolls growing by 700,000 and unemployment inching down to 5.7%. A robust upside surprise could lead the U.S. Federal Reserve to adjust its timetable for tapering its securities purchases and raising key interest rates.  "Too-strong economic data could perversely be a bad thing for markets if it caused the Fed to raise rates faster than expected," Carter said. "Weak employment data may actually be welcomed."

The Dow Jones Industrial Average (.DJI) rose 131.02 points, or 0.38%, to 34,633.53, the S&P 500 (.SPX) gained 22.44 points, or 0.52%, to 4,319.94 and the Nasdaq Composite (.IXIC) added 18.42 points, or 0.13%, to 14,522.38.  Of the 11 major sectors in the S&P 500, consumer staples (.SPLRCS) was the sole loser, shedding 0.3%.

Walgreens Boots Alliance Inc (WBA.O) dropped 7.4% after it said it expects to administer fewer COVID-19 vaccine shots in the fourth quarter. read more  Didi Global Inc (DIDI.N) jumped 16.0%, on its second day of trading as a U.S.-listed company. read more  Micron Technology Inc (MU.O) slid by 5.7% following a report that Texas Instruments (TXN.O) would buy Micron's Lehi, Utah, factory for $900 million. read more

Advancing issues outnumbered declining ones on the NYSE by a 1.78-to-1 ratio; on Nasdaq, a 1.32-to-1 ratio favored advancers.  The S&P 500 posted 36 new 52-week highs and no new lows; the Nasdaq Composite recorded 78 new highs and 30 new lows.

Volume on U.S. exchanges was 9.53 billion shares, compared with the 10.9 billion average over the last 20 trading days.