Today at the market – Wed 08/01
Posted On July 30, 2021
Fueled by strong earnings from Apple Inc., the S&P 500 Index rose higher at the open. Posting the day high at 2825.83 led by tech and financial stocks, the index reversed gains as investors remained cautious ahead of the release of the FOMC (Federal Open Market Committee) statement, which was closely watched. .
Sentiment was further reduced by renewed trade tensions following news that the Trump administration plans to increase tariffs on Chinese goods valued at $ 200 billion to 25% from the previously announced 10%.
The index fell sharply along with the release of the FOMC statement, hitting the day’s low at 2805.85 when the Federal Reserve signaled another imminent rate hike. Comparing some of the losses as investors assimilated the Fed’s announcement, the index closed the session lows at 2,813.36, down a slight 2.93 points and losing 0.10% compared to the close of the session. previous session.
The energy sector led the day’s falls, losing 1.33% in today’s session. Oil prices remained volatile and closed lower after a report from the EIA (Energy Information Administration) indicated a surprising increase in crude production of 3.8 million barrels during the week, along with a decrease in oil production. production. Chesapeake Energy Corp. led the sector’s decline, losing 5.72% after reporting a decline in revenue as a result of a drop in oil and gas sales.
Renewed concern about the trade war weighed on the trade-sensitive consumer discretionary, materials and industrial sectors. These sectors lost 1.28%, 0.97% and 0.44%, respectively, after the White House announced its plan to increase tariffs on Chinese goods valued at $ 200 billion to 25% from the announced 10%. previously. Hanesbrands Inc. was the worst performer in the index, falling 19.32% after reporting disappointing earnings.
Other notable losers were the utilities, consumer staples and telecommunications sectors, with a drop of 0.83%, 0.88% and 0.07%. On the other hand, the limiting daily losses were gains in the technology, real estate and healthcare sectors, with increases of 0.97%, 0.70% and 0.05%, respectively.
The financial sector in general closed the session unchanged, reversing the gains of the day after the release of the FOMC statement. The Federal Reserve left the interest rate unchanged but hinted at an imminent rate hike next month citing strong economic fundamentals. 10-year Treasury yields settled at 3,006%, crossing the psychologically important 3% mark for the first time since June.
Tech stocks continued their rally, rising 0.97% as Apple Inc. rose to all-time highs, gaining 5.89% intraday and approaching a $ 1 trillion milestone after the tech giant reported strong iPhone sales. and a higher orientation for the whole year. The real estate and health sector also closed higher, 0.70% and 0.05% respectively.
On the economic data front, private sector employment added 219,000 jobs in July compared to 178,000 jobs forecast. Meanwhile, the Institute for Supply Management’s ISM Manufacturing Index fell below expectations at 58.1% in July versus 59.5% expected. The drop was mainly due to a shortage of skilled labor and the higher cost of raw materials.