As the day went, all three indexes went up in the morning, the Dow an impressive 140 points, the Nasdaq and S&P considerably less but still enough to make new records. Again, it was all optimism for Friday’s meeting in Jackson Hole where the expectation is that the Fed will vote to keep things status quo, not tighten policy. But then, almost as if to hedge bets that there might be a surprise on Friday, everything dropped, for the Dow to close up just 40 and the other two to close even more modestly but still enough for the S&P to notch its 51^st record for the year.  

I got a chuckle from today’s expert predicting that the S&P had run its course and will not go up anymore the rest of the year, especially in view that the index was expected to lose 5% this year, something that hasn’t happened yet.  And I suspect that this expert is wrong and that the S&P along with the rest of the market will continue to rise for the simple reason, as all the other experts have put it, that the fundamentals remain strong. He also predicted a weak Q3, which I also found amusing considering that’s what everyone had said about Q2.  It’s like a game. Predict poor performance, then when things go better valuations rise and everyone makes money.  So close to Jackson Hole now, volume was predictably a bit below average at just under 8.3 billion. 

WED AUGUST 25, 2021  4:21 PM 

S&P 500, Nasdaq notch all-time closing highs ahead of Jackson Hole

By Stephen Culp

DJ: 35,366.26  +30.55        NAS: 15,019.80  +77.15        S&P: 4,486.23  +6.70       8/24

DJ: 35,405.50  +39.24        NAS: 15,041.86  +22.06        S&P: 4,496.19  +9.96       8/25

NEW YORK (Reuters) - Wall Street gained ground again on Wednesday, with chipmakers and financials helping to push the S&P 500 and the Nasdaq to record closing highs as investors look to the upcoming Jackson Hole Symposium for assurances that Federal Reserve’s timeline for policy tightening remains intact.  With few negative catalysts to sour the risk-on sentiment, all three major U.S. indexes ended the session modestly higher.

“Positive news on vaccination approvals, and expectations that the Fed won’t shock markets at Jackson Hole, are helping to keep equity prices higher,” said David Carter, chief investment officer at Lenox Wealth Advisors in New York, who added “it’s a very quiet market as many investors are sitting on the beach this week.”  Rising U.S. Treasury yields boosted rate sensitive financials, and sectors that stand to gain most from economic revival - smallcaps, chips and transports - were outperforming the broader market.  Days after the Food and Drug Administration gave full approval to the Pfizer-BioNTech COVID-19 vaccine, companies and institutions are moving toward either mandated inoculation, or penalization for those who forego the shot.  The Pentagon and Delta Air Lines are the latest to enact such measures, with Ford Motor Co and others potentially following suit.  For an interactive graphic on global vaccine deployment and new infection rates, click here.

The session marked the S&P 500’s 51st record high close so far this year.  Analysts polled by Reuters, however, see the stock market staying rangebound for the remainder of 2021, with the S&P 500 ending the year little changed as the pandemic recovery, along with corporate earnings growth, lose steam.  “Following a long run, equity indexes have cooled off as the next engine of growth is unclear,” Carter at Lenox Wealth Advisors added. “Fiscal and monetary stimulus may have lost their oomph to push markets higher still.”

Tame economic data, including flat new orders for core capital goods, reinforced the notion that Fed Chairman Jerome Powell is unlikely to hint at a shortened timeline for policy tightening at the virtual Jackson Hole Symposium, due to get underway on Friday.  “(The) expectation is that Fed won’t scare markets, and will announce only a cautious tapering,” Carter said.

The Dow Jones Industrial Average rose 39.24 points, or 0.11%, to 35,405.5, the S&P 500 gained 9.96 points, or 0.22%, to 4,496.19 and the Nasdaq Composite added 22.06 points, or 0.15%, to 15,041.86.  Financials were the clear winners among 11 major sectors in the S&P 500, gaining more than 1%. Healthcare stocks suffered the largest percentage decline.

Chipmakers Nvidia Corp and Applied Materials rose 1.9% and 1.2%, respectively, and along with mega-cap growth stocks Alphabet Inc, Tesla Inc and Facebook Inc, provided the biggest boost to the Nasdaq.  Nordstrom Inc tumbled 17.6% after the department store operator posted a 6% decline in quarterly revenue from pre-pandemic levels.  Dick’s Sporting Goods Inc announced a special dividend and raised its annual sales and profit forecast, sending its shares surging 13.3%.

Advancing issues outnumbered declining ones on the NYSE by a 1.49-to-1 ratio; on Nasdaq, a 1.31-to-1 ratio favored advancers.  The S&P 500 posted 63 new 52-week highs and one new low; the Nasdaq Composite recorded 125 new highs and 33 new lows.

Volume on U.S. exchanges was 8.29 billion shares, compared with the 9.00 billion average over the last 20 trading days.