S&P 500 ends up, little changed for week after Monday's steep selloff

S&P 500 ends up, little changed for week after Monday's steep selloff

By Caroline Valetkevitch

Fri August 9, 2024 4:52 PM

Uncertainty dominated the day as the indexes swung wildly back and forth several times between red and black, with the Dow at one point being down some 200, at another up some 200, but finally closing up 51 as investors struggle to make sense of recent events, dealing with recession fears and trying to find a bottom. The good news is that the Dow has today recovered more than 800 of the 1,000+ points lost on Monday and the overall indexes ended the week down only slightly, the S&P -0.05%, the Dow -0.6%, the Nasdaq -0.2%.  The VIX has fallen again, today down over 14 points to just over 20, vs over 35 on Monday, indicating nerves are starting to calm. All eyes are now on CPI and retail sales coming next week. Volume was again below the 4-week average of 12.6 billion coming in at 11.1 billion. 

DJ: 39,446.49  +683.04      NAS: 16,660.02  +464.22     S&P: 5,319.31  +119.81      8/8

DJ: 39,497.54  +51.05        NAS: 16,745.30  +85.28       S&P: 5,344.16  +24.85        8/9

Fri 8-9-24 4:52 pm S&P 500 ends up, little changed for week after Monday's steep selloff | Reuters

Nasdaq, S&P 500 end 2% higher in rally after US jobless data

Nasdaq, S&P 500 end 2% higher in rally after US jobless data

By Caroline Valetkevitch

Thu August 8, 2024 4:27 PM

Jobless claims falling more than expected sparked another robust rally today with all three indexes shooting straight up right out the gate and continuing a steady rise all day, closing impressively with mid-range 3-figure gains across the board. One week ago today, weak labor reports sparked a massive sell off due to recession worries which today have been written off as “probably a little overblown.” 

As for the long-term, as stated by today’s expert, “The fact that we’re up a lot doesn’t necessarily mean the lows are in or that we’re going straight up from here. But looking out three months, six months, the tendency to experience above average returns is very high.”  The VIX today dropped to 24 vs 38 on Monday in the depths of the rout. Volume was 11.98 billion, a little below the 4-week average of 12.6 billion.  

 

DJ: 38,763.45  -234.21      NAS: 16,195.81  -171.05     S&P: 5,199.50  -40.53        8/7

DJ: 39,446.49  +683.04     NAS: 16,660.02  +464.22    S&P: 5,319.31  +119.81     8/8

Thu 8-8-24 4:27 pm Nasdaq, S&P 500 end 2% higher in rally after US jobless data | Reuters  

Nasdaq ends down 1% as tech shares fall; Treasury auction weak

Nasdaq ends down 1% as tech shares fall; Treasury auction weak

By Caroline Valetkevitch

Wed August 7, 2024 4:40 PM

Oh brother, this market really doesn’t know how to relax! After yesterday’s rally after a remarkable 3-day rout, said rally continued in earnest this morning with the Dow rising nearly 500 points by 11 a.m.  Then all three indexes started a dive that lasted all day reaching red by 2 pm and continuing into another day of 3-digit losses by close. The trigger today was a weak Treasury auction that sparked the continuing panic. The good news, as today’s expert put it, “You don’t just have the fall we had on Monday and it’s done. You typically test the lows again before we can move out of this downtrend.” This would indicate that this correction is not expected to continue, let alone worsen. Volume came in at 12.9 billion, just a tad above the 12.6 average. 

DJ: 38,997.66  +294.39     NAS: 16,366.86  +166.77     S&P: 5,240.03  +53.70         8/6

DJ: 38,763.45  -234.21      NAS: 16,195.81  -171.05      S&P: 5,199.50  -40.53          8/7

Wed 8-7-24 4:40 pm Nasdaq ends down 1% as tech shares fall; Treasury auction weak | Reuters  

Indexes end with strong gains, rebounding from global market sell-off

Indexes end with strong gains, rebounding from global market sell-off

By Caroline Valetkevitch

Tue August 6, 2024 5:04 PM

Some encouraging anti-recession remarks from Fed officials today began to reverse the panic the market has been besieged with since Thursday triggering at least a buying spree which was really quite exuberant until about 3 pm when all the indexes went south again losing much of the session’s gains. The Dow had in fact risen almost 800 points before falling back to close with a gain of just under 300.  There was no explanation for the eleventh-hour collapse but, nonetheless, the headline of “Indexes End With Strong Gains,” needs to be taken with a grain of salt since they really only recovered about 10% of the last three days’ losses.

But even this modest recovery is very good news as valuations have been very stretched so the correction of the last few days has really just brought the market down to a more realistic and sustainable level. And though Q2 has been quite good, it hasn’t been great. The Fed’s comments, though positive, has caused yet another reassessment of the September rate cut with the odds of the ½ point today lowered to 75% (vs yesterday’s 86%) and the ¼ point raised to 25% (vs yesterday’s 14.) Volume was again exuberant coming in at 13.5 billion, still above the average of 12.5 billion. 

 

DJ: 38,703.27  -1,033.99     NAS: 16,200.08  -576.08      S&P: 5,186.33  -160.23       8/5

DJ: 38,997.66  +294.39       NAS: 16,366.86  +166.77     S&P: 5,240.03  +53.70        8/6

Tue 8-6-24 5:04 pm Indexes end with strong gains, rebounding from global market sell-off | Reuters

Nasdaq, S&P 500 fall 3% each amid US recession fears, Apple drop

Nasdaq, S&P 500 fall 3% each amid US recession fears, Apple drop

By Caroline Valetkevitch

Mon August 5, 2024 5:20 PM

In the biggest 3-day % decline in the market in two years, Wall Street was sending a message loud and clear to the Fed that they’ve waited too long and there better be a rate cut coming in September and, in fact, damn well should have been one last week. Last week’s disappointing Q2 and Q3 forecasts from some of the big tech mega-caps combined with lower than desired employment and manufacturing reports have set the markets into a panic over recession worries. Thursday and Friday both saw 3-digit losses greater each day and today the Dow slipped into a 4-digit loss.  Wall Street is not only telling the Fed a rate cut is needed right now but is insisting that the September cut be ½ point instead of the usual ¼ point with ½ point priced in at 86% vs 14 for ¼ point.

Warren Buffett also triggered some of this sell off by cutting his stake in Apple in half. Does he know something the rest of us don’t? But he’s also leaving $277B in cash at Berkshire Hathaway so plenty of room for new investments. Eyes on what he’ll do next. The VIX hit its highest close in four years, up to an astounding 55 points in the morning but the good news being that the panic subsided throughout the day to close at 38. Other good news included the Chicago Fed prez downplaying the recession scenario and that though the markets overall suffered the worst losses in two years, the critical tech indexes had been at these lows as recently as May meaning we’ve been here before and not long ago. As could be expected, volume was through the roof at 16.5 billion vs the 4-week average of 12.3 billion. 

DJ: 39,737.26  -610.71      NAS: 16,776.16  -417.98      S&P: 5,346.56  -100.12     8/2

DJ: 38,703.27  -1,033.99   NAS: 16,200.08  -576.08      S&P: 5,186.33  -160.23     8/5

Mon 8-5-24 5:20 pm Nasdaq, S&P 500 fall 3% each amid US recession fears, Apple drop | Reuters

Stocks drop, Nasdaq confirms correction as recession fears mount

Stocks drop, Nasdaq confirms correction as recession fears mount

By Chuck Mikolajczak

Fri August 2, 2024 4:39 PM

It was a second day when good inflation news, in this case a weak payrolls report, was seen as a recession predictor and thus sent all indexes into a freefall right out the gate with the S&P at its lowest in two months and the Dow and S&P each seeing their biggest two-day declines in 1-1/2 years. Add to that Amazon and Intel bringing in poor Q2 sending them down 8.8 and 26% respectively and the combo sent the Nasdaq down past the 10% mark, the official signpost of a correction. But the payrolls report proved the biggest trigger as, showing an increase in unemployment of slightly over 0.5% from the previous low, invoked the so-called Sahm Rule which says that any increase above 0.5% (in today’s case 0.53%) almost always immediately precedes recession.

(The graph dating back to 1970 demonstrates this, but it should be noted that 3 times since 1970, this was not the case and an additional 4 times of 8 when the recession was very short-lived.) Claudia Sahm, herself, a former Fed official who invented the indicator, has said that this year’s circumstances are very unique so her metric may very well not be applicable this time. The other good news is that the VIX also shot up to almost 30 before falling back to 23, which triggered brokers advising their clients that a sudden short-term jump in the VIX like that represented a good buying opportunity, an indication that the sell off is not expected to continue.  At 14.75 billion, volume was way above the 4-week average of 11.97 billion. 

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

DJ: 39,737.26  -610.71     NAS: 16,776.16  -417.98      S&P: 5,346.56  -100.12 8/2

Fri 8-2-24 6:10 pm Stocks drop, Nasdaq confirms correction as recession fears mount | Reuters  

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