Thursday, August 1, 2024

Stocks slump in August kick-off as data reignites slowdown worries

Stocks slump in August kick-off as data reignites slowdown worries

By Chuck Mikolajczak

Thu August 1, 2024 4:33 PM

The markets continue their longstanding pattern of wanting the economy to contract to hold down inflation and encourage rate cuts but not so much as to threaten recession, both of which are pretty subjective standards. Today, the subjective viewpoint is manufacturing declining to an 8-month low and unemployment applications increasing to an 11-month high, sparking fears that the economy is slowing down too quickly and reigniting concerns that the Fed has waited too long for the rate cuts. This is despite the fact that the slipping megacaps, the major concern for this past month, has proven baseless as their Q2 reports have come in above expectations.

Additionally, all data related to inflation has been more of less on target and 79% of 342 S&P companies have beaten expectations. But it is only one day and, as stated below, “August is typically one of the weakest months of the year for stocks.” The Dow was down over 700 points as late as 2:30 pm. In fact, all the indexes reached a low around 2:30 before beginning a recovery for which no explanation was offered.  The panic selling was well reflected in the considerably above average volume of 14.1 billion vs an average of 11.7 billion. 

DJ: 40,842.79  +99.46       NAS: 17,599.40  +451.98      S&P: 5,522.30  +85.86  7/31

DJ: 40,347.97  -494.82      NAS: 17,194.15  -405.25       S&P: 5,446.68  -75.62   8/1

Thu 8-1-24 4:33 pm Stocks slump in August kick-off as data reignites slowdown worries | Reuters


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