Dow Jones Rises as Corporate Earnings and Key Inflation Readings Await
The Dow Jones Industrial Average experienced a positive start to the week as investors eagerly awaited corporate earnings reports and key inflation readings. The blue-chip average soared by 407.51 points, or 1.16%, closing at 35,473.13. This marked the best day for the Dow since June 15. Helping the 30-stock index reach this milestone was a nearly 4% rally by Amgen.
Meanwhile, the S&P 500 made gains of 0.9%, ending the day at 4,518.44. However, the Nasdaq Composite only rose by 0.61% to 13,994.40, as a decline of almost 1% in Tesla’s stock price, caused by the departure of CFO Zach Kirkhorn, restrained its overall performance.
Both the Nasdaq Composite and S&P 500 managed to break their four-day losing streaks during Monday’s session. This upward momentum was fueled by Berkshire Hathaway, which climbed over 3%. The company’s strong earnings report and hefty cash stockpile left investors satisfied. Both A and B share classes of Berkshire Hathaway closed at record levels on Monday.
Elanco, an animal health care stock, also experienced a surge of 4% after surpassing Wall Street expectations. On the other hand, Tyson Foods didn’t fare as well, sliding by 3.8% due to an underwhelming report.
Sovos Brands, well-known for Rao’s pasta sauce, witnessed an impressive surge of over 25% following Campbell Soup’s announcement of its acquisition of the company. In contrast, Campbell Soup slipped by around 1.8%, leading its shares to reach their lowest price in over a year.
These movements in the market came after a week of losses on Wall Street. The Nasdaq Composite and S&P 500 both fell by approximately 2.9% and 2.3%, respectively, representing their worst weeks since March. The Dow also experienced a decline of 1.1% throughout the week.
This week’s trading kicked off the latest segment of what has generally been deemed a stronger corporate earnings season than initially anticipated. According to FactSet, approximately 85% of companies in the S&P 500 have reported their quarterly results, and about four-fifths of them have exceeded Wall Street forecasts.
“Markets are back on to a risk-on mode,” commented Chris Zaccarelli, chief investment officer of the Independent Advisor Alliance. “It’s been a better-than-expected earnings season, and so I think that’s why the market’s had such staying power.”
As the week progresses, investors will shift their attention to the release of July’s consumer and producer price index data. These indicators are closely scrutinized due to their correlation with inflation trends and the overall health of the economy.