S&P 500 and Nasdaq Set for Best Month In Two Years

Barry Adams
29 Jul, 2022
New York City

Benchmark indexes are set to rise for the third day in a row and extend weekly and monthly gains on the back of positive sentiment. 

The S&P 500 and the Nasdaq Composite indexes are set to advance at least 3.5% in the week after investors digested the latest batch of earnings. 

Investors overlooked the latest release of preferred inflation measure data and surmised that the weaker GDP data may encourage the Fed in slowing the future rate hikes. 

The S&P 500 index increased 1.01% to 4,113.75 and the Nasdaq Composite index rose 1.4% to 12,335.52. 

In July, the S&P 500 index is up 8%, the best monthly return in the year so-far and the Nasdaq Composite index has jumped 12%, its best monthly return in 2022.   

Futures of crude oil increased $3.80 to $100.21 a barrel and natural gas gained 20 cents to $8.32 a unit. 

 

PCE Jumps to 40-year High 

The yield on 10-year Treasury notes rose to 2.703% and 2-year notes rose to 2.93% after the Fed's preferred measure of inflation, which always understates the inflation experienced by most families, rose 6.8% in June. 

The personal consumption expenditure price index rose 6.8% in June, the fastest pace since 6.9% in 1982, according to the report released by the Bureau of Economic Analysis Friday.   

The PCE index increased 1% from May, the largest monthly increase since February 1981.

Core PCE, which excluded food and energy prices, rose 4.8% in June after rising at 5.3% in February. 

On a monthly basis, the core PCE index increased 0.6%, its largest monthly increase since April 2021. 

 

Movers: Amazon, Apple, Intel 

Amazon surged 10.4% to $134.99 after the online retailer reported a loss but guided higher-than-expected third quarter revenues. 

Revenues in the second quarter rose 7% to $121.23 billion. 

In the second quarter, Amazon reported a net loss of $2.0 billion or 20 cents a diluted share compared to $7.8 billion or 76 cents a diluted share a year ago.  

Second quarter 2022 net loss includes a pre-tax valuation loss of $3.9 billion from its investment in Rivian Automotive, Inc.

The online retailer guided third quarter revenues between $125 billion and $130 billion, an increase between 13% and 17% from a year ago. 

Apple Inc jumped 3.1% to $162.04 in trading after the regular trading hours after the company reported June quarter revenues increased 2% to $83 billion. 

Net income in the fiscal 2022 third quarter declined to $19.4 billion or $1.20 a diluted share from $21.7 billion or $1.331 a diluted share a year ago. 

Intel declined 10.7% to $35.41 after the semiconductor chipmaker reported June quarter revenues declined 22% to $15.3 billion, its largest decline in more than a decade. 

Intel's gross margin plunged to 36.5% from 57.1% a year ago and swung to net loss of $0.5 billion from net income of $5.1 billion a year ago. 

Quarterly loss was 11 cents a diluted share compared to income of $1.24 a year ago.  

Procter & Gamble declined 4.8% to $140.90 after the consumer products maker reported net sales in the fiscal year 2022 fourth quarter ending in June increased 3% to $19.5 billion. 

Net income rose 5% to $3.06 billion from $2.90 billion and diluted earnings per share rose to $1.21 from $1.13 a year ago.