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Stock Market News for Aug 6, 2021

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Benchmarks ended in the green on Thursday, as investors accessed positive weekly jobless claims data and awaited the monthly jobs report on Aug 6. Strong corporate earnings reports and rise in shares sensitive to economic recovery and technology stocks also helped indexes higher.

How Did the Benchmarks Perform?

The Dow Jones Industrial Average (DJI) rose 271.58 points, or 0.8%, to close at 35,064.25. Majority of the 30 major blue-chip stocks ended in the green, led by more than 2% gains in shares of, inc. (CRM - Free Report) , Amgen Inc. (AMGN - Free Report) and The Walt Disney Company (DIS - Free Report) . All the three stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The S&P 500 rose 26.44 points, or 0.6%, to end the session at 4,429.10, hitting a new all-time high. Nine of the 11 major sectors of the broader index closed in the green, led by over 1% gains in energy, financials and utilities sectors. Health and materials sectors were the only two to end in the negative territory declining 0.4% and 0.1% on Thursday.

The Nasdaq Composite Index closed at 14,895.12, after adding 114.58 points, or 0.8%. The tech-laden Nasdaq was boosted by 13.8% gain in shares of MercadoLibre, Inc. (MELI - Free Report) , followed by 5.9% gain in Booking Holdings Inc. (BKNG - Free Report) . Tech bigwigs like Facebook, Inc. (FB - Free Report) , Netflix, Inc. (NFLX - Free Report) and Microsoft Corporation (MSFT - Free Report) closed at least 1% higher for the session.

On Thursday, the fear-gauge CBOE Volatility Index (VIX) decreased 3.8%, to close at 17.28. Advancing issues outnumbered declining ones for 2.06-to-1 ratio on the NYSE, while a 2.26-to-1 ratio on the Nasdaq favored advancers. The S&P 500 posted 52 new 52-week highs and four new lows, while the Nasdaq Composite recorded 111 new highs and 103 new lows. A total of 8.86 billion shares were traded yesterday, lower than the last 20-session average of 9.63 billion.

Initial Claims Falls for Week Ending Jul 31

The government reported yesterday, that initial jobless claims dropped by 14,000 to 385,000 for the week ending Jul 31, higher than the consensus estimate of 382,000 and lower than prior weeks’ downwardly revised figure of 399,000. The drop in the week’s jobless claims now puts continuing claims below 3 million for the first time since March 2020. The number of people already collecting state jobless benefits (continuing claims) declined by 366,000 to a seasonally adjusted 2.93 million, for the week ending Jul 24. New claims fell in the states of Pennsylvania, Texas, Michigan and Georgia, however, Indiana posted a large increase. Investors now eagerly wait for the monthly jobs report that is scheduled for release on Aug 6.

Trade Deficit Hit a Record High

On Thursday, the U.S. Census Bureau and the U.S. Bureau of Economic Analysis jointly reported that the goods and services (trade) deficit was $75.7 billion in June, surpassing the consensus estimate of $73.3 billion. June’s figure is up $4.8 billion from a downwardly revised value of $71.0 billion in May. June exports were $207.7 billion, while imports were $283.4 billion, and the trade deficit increased $135.8 billion, or 46.4% from the same period last year. Higher demand for goods (foreign cars, computers, cell phones, clothes, alcohol and other goods) have fueled imports in the month and higher prices of oil and other goods also played a role.

Strong Corporate Earnings Boost Investors Sentiments

Per the latest Earnings Trends report released on Aug 4, 378 of the S&P 500 members have reported second-quarter 2021 earnings. So far, this earnings season, total earnings are up 103.8% on 28.2% higher revenues. In fact, 87.3% of these stocks have outpaced EPS estimates and 86.5% have topped revenue estimates.

Thursday, COVID-19 vaccine developer, Moderna, Inc. (MRNA - Free Report) reported second-quarter 2021 earnings of $6.46 per share, beating the Zacks Consensus Estimate of $6.01. While, revenues came in at $4.4 billion, beating the Zacks Consensus Estimate of $4.29 billion. The significant increase in revenues was driven by sales of its coronavirus vaccine, which is now approved for temporary/emergency use in several countries. During the earnings call, Moderna reported that its COVID-19 vaccine is 93% efficient even six months after the second dose. However, shares slid 0.7% yesterday after jumping 20.9% in the past two days to close at a record $419.05 on Wednesday. (Read More)

Stocks that made Headline

Air Transport Services (ATSG - Free Report) Q2 Earnings & Revenues Beat

Air Transport Services Group’s (ATSG - Free Report) second-quarter 2021 earnings (excluding 39 cents from non-recurring items) of 35 cents per share surpassed the Zacks Consensus Estimate of 26 cents. The bottom line declined year over year. (Read More)