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Wall Street ended mostly lower on Tuesday to start off August, a historically slow month for trade. Investors took things slowly in an over-bought market after two straight winning months. Two of the three major indexes ended in the red.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) rose 0.2% or 71.15 points to close at 35,630.68. Twenty-one components of the 30-stock index ended in negative territory, while nine ended in the positive.
The S&P 500 lost 0.3%, or 12.23 points, to close at 4,576.73. Eight of the 11 broad sectors of the benchmark index ended in negative territory. The Utilities Select Sector SPDR (XLU), the Consumer Discretionary Select Sector SPDR (XLY) and the Consumer Staples Select Sector SPDR (XLP) receded 1.2%, 1.1% and 0.5%, respectively, while the Industrials Select Sector SPDR (XL1) added 0.3%.
The tech-heavy Nasdaq declined 62.11 points, or 0.4%, to finish at 14,283.91.
The fear-gauge CBOE Volatility Index (VIX) was up 2.2% at 13.93. A total of 10.5 billion shares were traded on Tuesday, lower than the last 20-session average of 10.7 billion. Decliners outnumbered advancers on the NYSE by a 2.16-to-1 ratio. On the Nasdaq, a 1.67-to-1 ratio favored declining issues.
Trade Slow to Start Off a Seasonally Slow August
The market seemed to operate in a holding pattern on Tuesday without any major drivers. Having closed out two successive winning months in June and July, investors took things easy to start off August, historically one of the slowest months for trade in a year.
A better-than-expected second-quarter earnings season and growing optimism about a probable soft landing of the economy have meant that the market has been over-bought, and Tuesday can be seen as one of the sessions in which it corrected itself. Despite being encouraging, earnings are still expected to fall 5.9% from the year-ago quarter, per Refinitiv data. It remains to be seen whether the market would continue on its steady path upward, or whether the August woes would set in.
The Dow, however, continued on its merry way to notch up a small gain in the session. At one point in the day, it had touched its highest level since February 2022. Technology and Industrials drove whatever gains were made in the session.
The U.S. Census Bureau reported that construction spending for June had increased by 0.5%, against a consensus estimate of 0.9%. The percentage for May was revised up to an increase of 1.1% from the previously reported 0.9%.
Institute for Supply Management (ISM) reported that the ISM Manufacturing Index for July had come in at 46.4, below the consensus estimate of 46.9. In June, the index had come in at 46. However, even as the number seems to be an improvement from the prior period, as long as it remains below 50, the manufacturing sector would be seen as contracting.
Job openings, the principal measure of labor demand, fell 34,000 to 9.58 million in June, the lowest level since April 2021, per the Job Openings and Labor Turnover Survey, or JOLTS report.
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Stock Market News for Aug 2, 2023
Wall Street ended mostly lower on Tuesday to start off August, a historically slow month for trade. Investors took things slowly in an over-bought market after two straight winning months. Two of the three major indexes ended in the red.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) rose 0.2% or 71.15 points to close at 35,630.68. Twenty-one components of the 30-stock index ended in negative territory, while nine ended in the positive.
The S&P 500 lost 0.3%, or 12.23 points, to close at 4,576.73. Eight of the 11 broad sectors of the benchmark index ended in negative territory. The Utilities Select Sector SPDR (XLU), the Consumer Discretionary Select Sector SPDR (XLY) and the Consumer Staples Select Sector SPDR (XLP) receded 1.2%, 1.1% and 0.5%, respectively, while the Industrials Select Sector SPDR (XL1) added 0.3%.
The tech-heavy Nasdaq declined 62.11 points, or 0.4%, to finish at 14,283.91.
The fear-gauge CBOE Volatility Index (VIX) was up 2.2% at 13.93. A total of 10.5 billion shares were traded on Tuesday, lower than the last 20-session average of 10.7 billion. Decliners outnumbered advancers on the NYSE by a 2.16-to-1 ratio. On the Nasdaq, a 1.67-to-1 ratio favored declining issues.
Trade Slow to Start Off a Seasonally Slow August
The market seemed to operate in a holding pattern on Tuesday without any major drivers. Having closed out two successive winning months in June and July, investors took things easy to start off August, historically one of the slowest months for trade in a year.
A better-than-expected second-quarter earnings season and growing optimism about a probable soft landing of the economy have meant that the market has been over-bought, and Tuesday can be seen as one of the sessions in which it corrected itself. Despite being encouraging, earnings are still expected to fall 5.9% from the year-ago quarter, per Refinitiv data. It remains to be seen whether the market would continue on its steady path upward, or whether the August woes would set in.
The Dow, however, continued on its merry way to notch up a small gain in the session. At one point in the day, it had touched its highest level since February 2022. Technology and Industrials drove whatever gains were made in the session.
Consequently, shares of Cisco Systems, Inc. (CSCO - Free Report) and Meta Platforms, Inc. (META - Free Report) rose 1.2% and 1.3%, respectively. Both carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Economic Data
The U.S. Census Bureau reported that construction spending for June had increased by 0.5%, against a consensus estimate of 0.9%. The percentage for May was revised up to an increase of 1.1% from the previously reported 0.9%.
Institute for Supply Management (ISM) reported that the ISM Manufacturing Index for July had come in at 46.4, below the consensus estimate of 46.9. In June, the index had come in at 46. However, even as the number seems to be an improvement from the prior period, as long as it remains below 50, the manufacturing sector would be seen as contracting.
Job openings, the principal measure of labor demand, fell 34,000 to 9.58 million in June, the lowest level since April 2021, per the Job Openings and Labor Turnover Survey, or JOLTS report.