We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The rally continues. From the start of this week, just over the past three regular trading days, the Nasdaq is up another +2.25%, the small-cap Russell 2000 +1.88% over that same time period, the S&P 500 +1.82% and the Dow +1.12%. All these major indices are in the green for the past month of trading, from +0.40% (Dow) to +2.55% (Nasdaq).
For today, indices came off session highs into the close but all finished notably higher than the end of the day yesterday. The Dow, which was up a robust 300 points earlier today, finished +71 points, +0.28%. The S&P was a big stronger at +0.74%, the Russell still stronger at +1.05% and the Nasdaq +1.15% on the day. Cooling CPI numbers helped investors see a soft landing for the economy on the road ahead; for sure, it would seem there’s as good a chance for a soft landing now than at any time during the Fed tightening cycle over the past 16 months.
This afternoon also brought us the latest Beige Book from the Fed. It doesn’t provide lots of surprises, as a lot of the data has been cribbed from other sources, but it does give a comprehensive overview of the domestic economy based on independent surveys from 12 regions across the country. The overall picture is of slight upticks in most places, flat in others and modestly lower only in a couple.
Services, especially travel and hospitality, unsurprisingly gained since late May, while goods retailers lagged moderately. Auto sales were flat to slightly up, while housing demand remained strong even with the highest mortgage rates in 20 years. Job growth and wages were both up slightly for the period, while input costs finally gave sone relief to manufacturers. Not the most riveting economic picture, but certainly one with some promise, looking forward. Slight gains were seen in Boston, Minneapolis, Richmond, Dallas and Atlanta. Neutral cities include New York, Chicago, Cleveland. St Louis and Kansas City. Philadelphia and San Francisco posted modest declines.
Speaking of travel, Delta Air Lines (DAL - Free Report) becomes the first airline to report quarterly earnings for Q2 before the opening bell Thursday. The company’s stock rose to levels not seen since the first half of 2021, on raised guidance for the present quarter two weeks ago. Currently, analysts are looking for +66% earnings growth on +9.5% revenue growth in the quarter. This brings its Zacks Rank to #2 (Buy) with a Value-Growth-Momentum score of A. That said, the company has missed earnings estimates in seven of the past 12 quarters.
We’ll also see Producer Price Index (PPI) numbers tomorrow morning, along with Initial and Continuing Jobless Claims. Nothing appears to be as potentially impactful as today’s CPI numbers, not even Friday’s Q2 earnings from some of the biggest Wall Street banks like JPMorgan (JPM - Free Report) and Citigroup (C - Free Report) . But we’ll continue filling in the lines of the overall sketch as we march toward the next Fed meeting in the final week of this month.
Image: Bigstock
CPI, Beige Book Illustrate a Decent U.S. Economy
The rally continues. From the start of this week, just over the past three regular trading days, the Nasdaq is up another +2.25%, the small-cap Russell 2000 +1.88% over that same time period, the S&P 500 +1.82% and the Dow +1.12%. All these major indices are in the green for the past month of trading, from +0.40% (Dow) to +2.55% (Nasdaq).
For today, indices came off session highs into the close but all finished notably higher than the end of the day yesterday. The Dow, which was up a robust 300 points earlier today, finished +71 points, +0.28%. The S&P was a big stronger at +0.74%, the Russell still stronger at +1.05% and the Nasdaq +1.15% on the day. Cooling CPI numbers helped investors see a soft landing for the economy on the road ahead; for sure, it would seem there’s as good a chance for a soft landing now than at any time during the Fed tightening cycle over the past 16 months.
This afternoon also brought us the latest Beige Book from the Fed. It doesn’t provide lots of surprises, as a lot of the data has been cribbed from other sources, but it does give a comprehensive overview of the domestic economy based on independent surveys from 12 regions across the country. The overall picture is of slight upticks in most places, flat in others and modestly lower only in a couple.
Services, especially travel and hospitality, unsurprisingly gained since late May, while goods retailers lagged moderately. Auto sales were flat to slightly up, while housing demand remained strong even with the highest mortgage rates in 20 years. Job growth and wages were both up slightly for the period, while input costs finally gave sone relief to manufacturers. Not the most riveting economic picture, but certainly one with some promise, looking forward. Slight gains were seen in Boston, Minneapolis, Richmond, Dallas and Atlanta. Neutral cities include New York, Chicago, Cleveland. St Louis and Kansas City. Philadelphia and San Francisco posted modest declines.
Speaking of travel, Delta Air Lines (DAL - Free Report) becomes the first airline to report quarterly earnings for Q2 before the opening bell Thursday. The company’s stock rose to levels not seen since the first half of 2021, on raised guidance for the present quarter two weeks ago. Currently, analysts are looking for +66% earnings growth on +9.5% revenue growth in the quarter. This brings its Zacks Rank to #2 (Buy) with a Value-Growth-Momentum score of A. That said, the company has missed earnings estimates in seven of the past 12 quarters.
We’ll also see Producer Price Index (PPI) numbers tomorrow morning, along with Initial and Continuing Jobless Claims. Nothing appears to be as potentially impactful as today’s CPI numbers, not even Friday’s Q2 earnings from some of the biggest Wall Street banks like JPMorgan (JPM - Free Report) and Citigroup (C - Free Report) . But we’ll continue filling in the lines of the overall sketch as we march toward the next Fed meeting in the final week of this month.
Questions or comments about this article and/or author? Click here>>